The “PDO Economy” resists Covid, turnover of 16.6 billion euros and stable exports

After ten years of uninterrupted growth, Italy’s PDO Economy, world leader in certified agri-food products with 841 PDO, PGI and TSG products, stopped running in 2020 with the onset of the pandemic and saw its production value drop by 2% to 16.6 billion euros. A slowdown, however, contained, considering the heavily negative results for all economic sectors in Covid’s toughest year, confirming the ability of Italian PDO and PGI excellence to hold up even in the most difficult situations, and the value of its economic weight, so much so that 1 euro out of every 5 of Italian agri-food products comes from Geographical Indication products. In 2020, PDO Economy exports also held up, at 9.5 billion euros (-0.1%), accounting for 20% of total Italian agri-food exports. Data come from the XIX Ismea-Qualivita Report, illustrated today in Rome, at the Ministry of Agriculture, in the presence, among others, of Minister Stefano Patuanelli.
As the report shows, the export result, which suffers first of all from the drop on non-EU markets linked to the pandemic, shows a swinging trend for the food and wine sectors: the former, which involves 86,000 operators, 165 authorized Consortia and 46 control bodies, and records an increase in the value exported of 1.6%, to 3.92 billion euros, a figure that has more than doubled since 2010 (+104%). The second, wine, which involves more than 113,000 operators, 121 authorized Consortia and 12 control bodies, shows an increase in production destined for export which exceeds 15.4 million hectolitres (+1.8%) but in terms of value exports stand at 5.57 billion euros, down 1.3% on an annual basis. This is a slight slowdown in an otherwise brilliant trend that has grown by 71% since 2010 (and which, in any case, resumed in 2021, pending end-of-year figures that should confirm a record export of 7 billion euros, ed). Sparkling wines in particular lost ground (-6.6% for PDO sparkling wines, to 1.2 billion and -8.3, to 26 million, for PGI sparkling wines) and PDO still wines (-1%, to 2.6 billion). On non-European markets, PDO PGI wine exports fell by 4.3%, while exports to the EU grew (+4.1%), with double-digit increases in Scandinavian countries and Northern Europe.
In 2020 - as illustrated in the Ismea-Qualivita report - the value of production of PDO, PGI and TSG food held up well, reaching 7.3 billion euros in production value, -3.8% in one year and with a trend of +29% since 2010. The value for consumption was stable, at 15.2 billion Euros, with a trend of +34% compared to 2010. Cheeses, with a production value of 4.2 billion euros, are the category that has the most important economic weight, accounting for 57% of the entire PDO PGI food basket, followed by meat products with 1.9 billion euros and a weight of 26%, and then fruit and vegetables (404 million), thanks to the increase in average price lists and apples that drag the category along with nuts and Sicilian citrus fruits.
For Geographical Indication food, with Italians forced to stay at home more because of the pandemic, there was strong growth in sales in large-scale distribution (+5.3%), as was the case for PDO and PGI wine (+8.5%), which in 2020 recorded 24.3 million hectolitres of bottled PDO and PGI wine (+1.7%), with PDO wines accounting for 68% of production and PGI wines for 32%. The value of bulk production of Geographical Indication wines is 3.2 billion euros, while the value of bottled wine is 9.3 billion (-0.6%), with PDO wines accounting for 81% of the total.
In this context, there is no shortage of elements confirming the dynamism of the Italian Geographical Indications system; in fact, the advancement of the South and Islands is noted, the only area to show an overall increase in value compared to the previous year (+7.5%), with significant growth especially for Puglia, driven by a +27.6% increase in the value of its IG wine (for a total of 597 million euros from the previous 468 million) and for Sardinia, with a +27.3% increase in the value of its IG food production. In 2020, categories such as Pasta, with 240 million euros of value of production driven by Pasta di Gragnano PGI (+17%, to 239 million) and Bakery and pastry products, with 82 million euros driven by the success of Piadina Romagnola PGI (50 million euros) and Cantuccini Toscani (24 million) are also worth mentioning.
After 2019 that had shown growth for 17 out of 20 regions, the 2% drop in the overall value of the sector in 2020 is spread over more than half of the regions. In the ranking of the territorial economic impact of Geographical Indications, the concentration of value in Northern Italy is confirmed. In particular, the North East remains the sector’s driving force, representing more than half of the total national value of PDOs and PGIs (53%). Veneto, which remains the leading region, thanks above all to “his majesty” Prosecco, stands at 3.70 billion euros, with the value of its wine production, however, falling to 3.3 billion from the previous 3.4 billion in 2020, a drop of 3%. “In these two difficult years, strongly marked by the pandemic, this sector represents the driving force behind the promotion of the territories and a distinctive sign of Made in Veneto. This urges us to think even more strongly about the protection of our excellence, from Prosecco to other wines, from Grana Padano to Asiago, together with the other products that express the Veneto region”, commented the President of the Veneto Region, Luca Zaia.
After Veneto, in the Qualivita-Ismea report, there is Emilia Romagna, with 3.26 billion and a significant loss in the value of its Food Valley (-7.3%), and Lombardy with 2.07 billion. Just behind the podium are Piedmont and Tuscany, with over 1 billion euros generated by geographical indications. And Piedmont, in particular, grew in value both in the food sector (from 337 million to 361 million) and in the wine sector (from 1.014 billion to 1.027 billion, with the advance of Asti PDO +10.2% to 118 million) and recorded an overall year-on-year growth of 2.7%. There was also a good result for the sixth-placed Trentino Alto Adige (+8.4%), with growth in value in both the food (from 318 to 371 million) and wine (from 558 to 578 million) sectors.
Among the top 20 provinces in terms of value, no fewer than 11 are from the North-East regions, starting with the top three, which have a territorial impact of more than one billion euros: Treviso (1.6 billion but down 5%), Parma (1.3 billion but down 8.25%) and Verona (1.2 billion and down 2%). In terms of annual growth, among the top provinces, the best results are those of Trento (+10.7%) and Bolzano (+6.4%), Asti (+10.2%) and Naples (+15.8%). “The growth recorded in some provinces, especially in southern Italy”, said Mauro Rosati, director of the Qualivita Foundation, illustrating the report, “confirms the development of some economic poles created around protection consortia which, although not belonging to large production districts, are able to place themselves at the center of sustainable quality territorial systems”.
“PDO and PGI products are confirmed in 2020 as a fundamental component in the affirmation of Made in Italy on global markets and as an engine for the promotion and protection of Italian excellence”, observed the Minister for Agricultural Policies Stefano Patuanelli, “and the analysis of the XIX Ismea-Qualivita Report demonstrates once again how, thanks to the distinctiveness and tradition of our products, the PDO economy holds up both nationally and abroad, grows in the regions of the South and the Islands, and drives the entire Italian agri-food sector. At EU level, a challenging year awaits us, both for the revision of the labeling regulatory framework and for that of the PDO and PGI regulations. For this very reason, it is necessary to safeguard and protect the entire production system from the risks that can be generated by food standardization, misleading labeling systems such as Nutriscore, fake news, and attempts at imitation both on EU and non-EU markets. The NRP, with the supply chain and district contracts, incentives for innovation, and digitalization, represents a great opportunity for the growth of the PDO and PGI supply chains. As the Ministry, we are already committed to accompanying companies at this delicate time, with the intention of putting them in the best conditions to intercept the opportunities and make a further qualitative leap in the world and in Europe”.
The Minister then explained, at the microphones of WineNews, the lines of action planned against the high cost of energy, which is also putting agricultural businesses in difficulty. “On energy, immediate resources must be found”, he said, “and, in the next quarter, we must quickly put on the ground the resources that are in the NRP for energy self-production and make farms independent. And then we have to make structural reform of the system’s bodies which, in my opinion, should be included in general taxation and cannot be included in the bill because they increase exponentially when the cost of raw materials rises”. But that’s not all: “We are working with the other ministries to ask for an extension of the moratorium on loans and financing, at least for agri-food producers”, Patuanelli said.
Ismea President Angelo Frascarelli stressed that “differentiation, together with innovation and organization, is the lever of success of Italian agri-food. The data that the Ismea-Qualivita Report on Geographical Indications carefully monitors tell us of a production model strongly oriented towards quality, territorial links and multilevel differentiation. In the future, however, the agri-food chain needs to address this issue with even greater commitment than in the past, directing its efforts to move away from the logic of commodities and making distinctiveness the cornerstone of production and commercial strategies”. According to the President of Fondazione Qualivita, Cesare Mazzetti, “the Ismea-Qualivita Report, which has been accompanying the evolution of the Italian PDO-PGI system for 19 years now, once again shows how it represents an effective model for the development of territories. The cohesion of the supply chain, the guarantee of safety for consumers and the ability to dialogue with institutions have been strong points in keeping the sector going in response to the difficulties that emerged during the first phase of the pandemic. The numbers of our analyses are the result of the joint work of operators, protection consortia, bodies and institutions throughout Italy. The Qualivita Foundation will continue to support the system through its analysis of the sector, proposing useful elements to define a new strategic vision of quality in response to the changes taking place and the new objectives of the ecological transition". According to Cesare Baldrighi, president of Origin Italia, the system of Geographical Indications "must now define a new strategy, based on progress” and this progress can be achieved by going in the direction of “sustainable supply chains, environmental initiatives, quality tourism, promotion of the values of the supply chain and the related culture and well-being”.