Voluntary Report - public distribution

**Date:** 7/12/2004

**GAIN Report Number:** PL4019

PL2004

**Poland**

**Product Brief**

**Value-Added Products**

**2004**

Approved by:

![](media/image1.wmf)**Charles Rush, Agricultural Attaché**

**U.S. Embassy**

Prepared by:

Jolanta Figurska, Marketing Specialist

Charlene Kastanek, Agricultural Intern

**Report Highlights:**

Poland\'s food retail sector continues to undergo radical transformation
as consumer incomes grow. The presence of foreign hypermarkets continues
to grow; however, prospects for U.S. sales are hampered by stiff Polish
and EU competition. Poland\'s real GDP demonstrated growth of 3.8
percent in 2003, and domestic demand increased by 2.4 percent in 2003.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Warsaw \[PL1\]

\[PL\]

# Section I. Poland's Demographics

The Republic of Poland is the ninth largest country in Europe, located
in Europe's very center, it is bordered by Germany to the West, the
Czech and Slovak Republics to the South, Ukraine, Belarus, and Lithuania
to the East, and Russia to the North. Poland's northern coastline runs
along the Baltic Sea, which supplies its productive seafood industry.
The largest rivers include the Vistula, Odra, Warta, and Bug, all of
which provide vital transport and water. Poland's well-developed timber
industry is supported by forests, which cover 28 percent of the country.
(The climate is relatively moderate with 60-75 degree Fahrenheit summer
temperatures and winter temperatures of 14-32 degrees Fahrenheit. The
average rainfall per year is 24 inches.)

Poland's population of 38.6 million represents 5 percent of the total
population of Europe. Sixty-two percent of the population lives in urban
areas. The average density is 320 people per square mile. The population
is split almost evenly between males and females. Poland's population is
rather young with 32.7 percent of the population under the age of 24,
and an overall average age of 38 years.

Poland's real GDP has been growing, showing a 3.8 percent increase in
2003. Growth is expected to increase to 5.4 percent in 2004. Domestic
demand grew by 2.4 percent in 2003 and is expected to continue to grow
rapidly, reaching 4.8 percent in 2005. The inflation rate continues to
fall, having dropped one percent from 2002. The unemployment rate
appears to have peaked and declined slightly from 2002 to 2003.

# Section II. Foreign Investment and Trade Summaries

Poland's largest western foreign investor is France, investing 13.9
billion dollars in capital, while Russia continues to be Poland's
largest eastern foreign investor, investing 1.3 billion dollars in
capital. Foreign Direct Investment (FDI) increased from 6.1 billion
dollars in CY 2002 to 6.4 billion in CY 2003. Foreign investment is
primarily being used to update transportation and food processing,
accounting for 18.5 percent of all FDI.

Food and beverage purchases accounted for 39% of total consumer spending
according to a recent poll. Real GDP in CY 2003 grew at a rate of 3.8
percent, which is up from CY 2002; consumers still demand a greater
variety of products. This guide is designed to assist exporters in
identifying and taking advantage of opportunities for U.S. high value
products in a changing market, as Poland's markets in several areas have
opened due to the May 1, 2004, European Union accession.

**Table I. U.S. Imports of Consumer-Oriented Products by Poland**

(In US \$1000)

  -------------------------- ---------- ------- -------------------------- ----------
  **Product**                **2002**   ** **   **Product**                **2003**

  Fresh Fruit                7642               Red Meat & Offals          17698

  Spirits & Alcoholic Drinks 4236               Fresh Fruit                9775

  Processed Fruit            3567               Fish & Crustaceans         6913

  Processed Oils             3303               Spirits & Alcoholic Drinks 5474

  Poultry                    2306               Fruit Products             3445
  -------------------------- ---------- ------- -------------------------- ----------

**Table II. EU Imports of Consumer-Oriented Products by Poland**

(In US \$1000)

  -------------------- ------------- ------- ------------------------ ----------
  **Product**          **2002**      ** **   **Product**              **2003**

  Fresh Fruit          265752                Confectionery            108193

  Processed Oils       146970                Coffee, Cocoa, Tea       178002

  Coffee, Cocoa, Tea   130869                Vegetable Fats & Oils    183369

  Confectionery        97603                 Cakes & Meals            207438

  Fresh Vegetables     313626                Fresh Fruit              313626
  -------------------- ------------- ------- ------------------------ ----------

**Table III. World Imports of Consumer-Oriented Products by Poland**

(In US \$1000)

  -------------------- ------------- ------- ------------------------ ----------
  **Product**          **2002**      ** **   **Product**              **2003**

  Fresh Fruit          479828                Vegetable Fats & Oils    239315

  Processed Oils       168417                Fish & Crustaceans       322947

  Coffee, Cocoa, Tea   333332                Cakes & Meals            356831

  Confectionery        481764                Coffee, Cocoa, Tea       481764

  Fresh Fruits         551838                Fresh Fruit              551838
  -------------------- ------------- ------- ------------------------ ----------

Source: Foundation of Assistance Programs for Agriculture (FAPA)

The Polish government works to ensure the safety and quality of food for
Polish consumers through a number of regulatory means. Information
specifically pertaining to Poland may be obtained from FAS's Food and
Agricultural Import Regulations and Standards (FAIRS) report for Poland,
which will be updated to reflect the new EU regulations in August 2004.
Most of the newer measures are the same as those observed in the
European Union. The most important EU regulations can be found in FAS's
FAIRS report for the European Union, which can be found at the following
address http://www.useu.be/agri/usda.html.

The development of tourism, increased employment of women, and annual
income increases have resulted in expansion of the Hotel, Restaurant and
Institutional (HRI) Food Service Sector (see Table IV). For Poles living
in urban areas, eating out is no longer a rarity, as it was in the early
90's. Consumers are also developing an interest in food variety, ranging
from Mediterranean to Asian, with a specific demand for fast food.

Processed foods, which account for 27 percent of all Polish agricultural
and food imports, represent the most popular import type in this sector.

Poland's food retail sector continues to undergo radical transformation
as consumer incomes grow. This change is led by new foreign
hypermarkets, which account for 15 percent of all national modern
grocery distribution. Prospects for U.S. sales are hampered by stiff
Polish and EU competition, comparatively high import duties, stringent
food ingredient regulations, and costly terms of business to get
products onto large retailers' shelves. Nevertheless, there are select
opportunities outlined in section IV, "Best Prospects," in the Post's
Retail Food Sector report. (See Table IV). These include, but are not
limited to:

-   Wine, beer, various non-alcoholic beverages

-   Food for the HRI food service sector,

-   Processed meat, fish, fruits and vegetables, and spices,

-   Highly processed/ready-to-cook products & snacks,

-   "Healthy food" produced from natural agricultural products with a
    low level of pesticides, mineral fertilizers, and other chemicals
    applied for their cultivation,

-   "Luxury" food and drinks, produced from exotic raw materials for
    people with the highest incomes,

-   Food ingredients for special use, e.g. sweeteners replacing sugar,
    protein or vitamin preparations necessary for production of diet
    foods.

# Section III. Office of Agricultural Affairs, Warsaw

The Office of Agricultural Affairs, Warsaw represents the United States
Department of Agriculture, Foreign Agricultural Service (FAS) in Poland.
FAS supports U.S. food and agriculture exporters in the Polish market
and can provide lists of Polish companies importing food and
agricultural products.

FAS prepares several of the reports mentioned above annually. FAS also
generates reports, which contain regulations on preparing goods for
shipment, regulations concerning documentation which should accompany
goods, and details on border/entry regulations. These include
information about restrictions concerning food additives, veterinary
procedures/mandates, and sanitary regulations for products.

**FAS Warsaw Contact Information:**

Foreign Agricultural Services, USDA

Wayne Molstad, Agricultural Counselor

American Embassy

Al. Ujazdowskie 29/31

00-540 Warsaw Poland

E-Mail: agwarsaw@usda.gov or agwarsaw@poctza.onet.pl

Phone: 48 22 504 2336, Fax: 48 22 504 2320

For additional information/details on the Polish market, please see the
following table of reports. All can be accessed by visiting the FAS web
site \<www.fas.usda.gov\> and clicking on the link, Attaché Reports.

## Table IV. Additional Reports

  -------------------------------- ------------------ -------------------
  **Report**                       **Revised Annually **Latest GAIN
                                   on or about:**     Report \#**

  1\. Food Processing Sector       January 7          #PL3045

  2\. Exporter Guide               October 6          #PL3036

  3\. FAIRS (Country Report)       August 5           #PL3022

  4\. HRI Food Service Sector      January 7          #PL3001

  5\. Retail Foods Sector          November 19        #PL3002
  -------------------------------- ------------------ -------------------

Following this report is a table of Polish imports and exports with the
world and the United States. These reports are based on information
obtained from FAPA. Also, updated BICO reports can be accessed at
\<www.fas.usda.gov/scriptsw/bico/bico_frm.asp\> and searching by country
for Poland. These report U.S. exports to Poland and imports from Poland.

# Table V: Value

  --------------------------- -------------- ------------- ------------- -------------- ------------- -------------
  **Polish Agri-Food Trade                                                                            
  with the World**                                                                                    

  **Group/Commodities**       **Export (\$                               **Import (\$                 
                              thousands)**                               thousands)**                 

                              **2001**       **2002**      **2003**      **2001**       **2002**      **2003**

  **I. Animal Products**                                                                               

  **A. Live Animals (1-4)**   119792         138626        169755        39347          44359         43484

  1\. Horses                  38057          32039         41953         4487           2477          4109

  2\. Cattle                  70613          94480         107763        768            10338         9118

  3\. Sheep                   5735           4887          5681          0              33            186

  4\. Other                   5387           7218          14358         34092          31511         3007

  **B. Processed Products     721299         682351        1043571       135741         166305        182558
  (5-11)**                                                                                            

  5\. Red Meat &Offals        138885         166645        306707        38413          75237         86455

  6\. Poultry Meat & Offals   106381         128295        243756        23308          21870         19459

  7\. Meat Products           88053          94078         110456        8188           10187         10178

  8\. Animal Fats             9045           8155          12921         8406           8639          9365

  9\. Milk, Cream, &          265833         181109        215638        36506          27429         26031
  Ice-Cream                                                                                           

  10\. Butter                 25426          17444         21312         5377           6568          10345

  11\. Cheeses & Curds        87677          89625         132782        15544          16376         20726

  12\. Other Animal Products  53885          75076         137733        102374         111916        151681

  **C. Other**                214508         226032        296682        355130         321151        369090

  13\. Fish & Crustaceans     133128         124478        179324        323035         281656        322947

  14\. Fish Products          81380          101553        117358        32096          39495         46143

  **Total I (1-14)**          1109484        1122085       1647741       632592         643731        746813

  **II. Crop Products**                                                                                

  **D. Raw Materials**        287777         353357        507260        886791         844936        948501

  15\. Cereals                2215           65044         70322         173452         114047        120395

  16\. Oilseeds               67030          9587          3584          47354          52070         64656

  17\. Fresh Potatoes         2680           4309          12527         9024           12868         7578

  18\. Fresh Fruits           79116          107941        150981        482897         479828        551838

  19\. Fresh Vegetables       96172          120885        205216        95873          97621         99871

  20\. Flowers                40564          45590         64630         78190          88501         104165

  **E. Processed Products     1039103        1135773       1470074       905419         949411        1087840
  (21-29)**                                                                                           

  21\. Vegetable Fats & Oils  24301          17867         19015         168417         193396        239315

  22\. Cereal Milling         6122           7861          12384         29006          28574         35344
  Products                                                                                            

  23\. Cakes & Meals          29015          23504         21815         316387         323237        356831

  24\. Starch, Croups, Malt   32336          37440         49337         66638          53872         62513

  25\. White Sugar            81571          50374         98619         18324          26191         21396

  26\. Molasses               24379          25191         24739         18             9             35

  27\. Confectionery          200178         220016        270215        112211         126880        147277

  28\. Fruit Products         379838         475579        631051        123497         127162        147417

  29\. Vegetable Products     261363         277940        342900        70920          70090         77712

  30\. Other Crop Products    278463         365043        499751        340956         376668        434936

  **Total II (15-30)**        1605343        1854173       2477084       2133165        2171015       2471278

  **III. Other Products**                                                                              

  31\. Coffee, Cocoa, Tea     120702         117599        142616        333332         365385        481764

  32\. Tobacco & Preparations 80709          49051         83037         119935         195428        67241

  33\. Spirits & Alcoholic    49429          57793         68832         94753          104706        129590
  Drinks                                                                                              

  34\. Water & Non-Alcoholic  11736          21865         28068         18293          12965         22127
  Drinks                                                                                              

  35\. Other                  52679          62503         71255         73925          82427         94083

  **Total III (31-35)**       315255         308811        393808        640238         760911        794805

  **Total (I+II+III)**        **3030082**    **3285069**   **4518633**   **3405995**    **3575657**   **4012896**
  --------------------------- -------------- ------------- ------------- -------------- ------------- -------------

# Table VI: Quantity

  --------------------------- ------------- ------------- ------------- ------------- ------------- ----------
  **Polish Agri-Food Trade                                                                          
  with the World**                                                                                  

  **Group/Commodities**       **Export                                  **Import                    
                              (Tons)**                                  (Tons)**                    

                              **2001**      **2002**      **2003**      **2001**      **2002**      **2003**

  **I. Animal Products**                                                                             

  **A. Live Animals (1-4)**                                                                          

  1\. Horses                  20212         16419         21407         3576          1745          1815

  2\. Cattle                  46213         67277         66235         431           5130          4206

  3\. Sheep                   3189          2713          2641          0             19            60

  4\. Other                   1053          1607          5145          3073          2381          1614

  **B. Processed Products                                                                            
  (5-11)**                                                                                          

  5\. Red Meat &Offals        82829         119344        270485        30553         53822         57300

  6\. Poultry Meat & Offals   38048         51660         100691        23549         25548         20335

  7\. Meat Products           46900         42449         35718         4131          5704          4134

  8\. Animal Fats             20501         21513         32103         14501         12248         6456

  9\. Milk, Cream, &          174630        178853        176347        36183         30023         20584
  Ice-Cream                                                                                         

  10\. Butter                 18606         11849         9179          3495          4615          5345

  11\. Cheeses & Curds        45388         41765         51965         4815          4818          5655

  12\. Other Animal Products  40957         55082         69099         85135         100954        100184

  **C. Other**                                                                                       

  13\. Fish & Crustaceans     50343         44155         49976         239367        199164        209804

  14\. Fish Products          39681         42087         43634         18402         21129         24973

  **Total I (1-14)**          628550        696773        934625        467211        467300        462465

  **II. Crop Products**                                                                              

  **D. Raw Materials**                                                                              

  15\. Cereals                8972          566654        574958        1163052       617386        591939

  16\. Oilseeds               297629        37285         8927          89910         98731         108526

  17\. Fresh Potatoes         49460         57544         153066        39702         66302         28249

  18\. Fresh Fruits           351825        428501        459691        997756        950610        918009

  19\. Fresh Vegetables       327147        256547        458916        186679        176993        181451

  20\. Flowers                37308         43980         49161         53718         54723         75114

  **E. Processed Products                                                                            
  (21-29)**                                                                                         

  21\. Vegetable Fats & Oils  41946         33456         28185         360693        358115        352513

  22\. Cereal Milling         11652         21955         23878         206891        207467        234467
  Products                                                                                          

  23\. Cakes & Meals          226473        202482        157523        1498602       1572700       1605462

  24\. Starch, Croups, Malt   160112        166334        183929        205829        181686        197280

  25\. White Sugar            295135        207793        425598        63984         89046         75096

  26\. Molasses               279115        251819        292817        32            5             15

  27\. Confectionery          88853         89164         102863        68409         69525         68025

  28\. Fruit Products         503347        552734        557292        164684        137763        141824

  29\. Vegetable Products     4712212       411719        493048        98763         87309         89824

  30\. Other Crop Products    167065        198842        246280        169903        180709        169813

  **Total II (15-30)**        7558251       3526809       4216132       5368607       4849070       4837607

  31\. Coffee, Cocoa, Tea     49766         48597         52273         254617        236488        248365

  32\. Tobacco & Preparations 19072         11547         16052         34973         54405         22316

  33\. Spirits & Alcoholic    40288         42300         47127         118202        122862        104545
  Drinks                                                                                            

  34\. Water & Non-Alcoholic  47606         106056        112663        55667         3606871       3485654
  Drinks                                                                                            

  35\. Other                  75143         77531         83342         99389         99090         102724

  **Total III (31-35)**       231875        286031        311457        562848        4119716       3963604

  **Total (I+II+III)**        **8418676**   **4509613**   **5462214**   **6398666**   **9436086**   9263676
  --------------------------- ------------- ------------- ------------- ------------- ------------- ----------

# Table VII: Value

  --------------------------------- -------------- ---------- ---------- -------------- ---------- ----------
  **Polish Agri-Food Trade with the                                                                
  US**                                                                                             

  **Group/Commodities**             **Export (\$                         **Import (\$              
                                    thousands)**                         thousands)**              

                                    **2001**       **2002**   **2003**   **2001**       **2002**   **2003**

  **I. Animal Products**                                                                            

  **A. Live Animals (1-4)**         622            643        611        419            109        362

  1\. Horses                        617            620        596        63             16         200

  2\. Cattle                                                             13             22          

  3\. Sheep                                                                                         

  4\. Other                         5              23         15         343            70         162

  **B. Processed Products (5-11)**  41243          43666      47625      10254          9671       19814

  5\. Red Meat &Offals              26             68         53         2012           6606       17698

  6\. Poultry Meat & Offals         0                                    7449           2306       798

  7\. Meat Products                 29223          31903      32553      115            1          5

  8\. Animal Fats                   35             6          1          292            702        1276

  9\. Milk, Cream, & Ice-Cream      964            496        982        382            55         26

  10\. Butter                       1820           284        304                                   

  11\. Cheeses & Curds              9174           10909      13731      4              1          11

  12\. Other Animal Products        2853           2907       3075       5785           7430       5141

  **C. Other**                      8658           15084      10168      1229           4573       6917

  13\. Fish & Crustaceans           5521           6815       4276       1219           4563       6913

  14\. Fish Products                3137           8269       5892       11             11         4

  **Total I (1-14)**                53376          62299      61480      17687          21783      32234

  **II. Crop Products**                                                                             

  **D. Raw Materials**              328            824        865        10758          15265      12851

  15\. Cereals                      11             18         34         1575           2253       1218

  16\. Oilseeds                     10             23         25         1693           4540       1343

  17\. Fresh Potatoes               0                                                   0          1

  18\. Fresh Fruits                 27             18         9          6801           7642       9775

  19\. Fresh Vegetables             11             104        238        134            133        67

  20\. Flowers                      270            661        559        556            696        445

  **E. Processed Products (21-29)** 28408          45516      55727      13172          9143       9198

  21\. Vegetable Fats & Oils        268            357        572        4715           3303       1740

  22\. Cereal Milling Products      405            380        703        31             17         21

  23\. Cakes & Meals                               0          7          567            121        82

  24\. Starch, Croups, Malt         4324           10542      18865      715            310        76

  25\. White Sugar                  42             40         60         2              5          22

  26\. Molasses                     3535           2588       3303       0              0          2

  27\. Confectionery                6993           10364      11039      784            1157       3128

  28\. Fruit Products               7566           15337      11940      5497           3567       3445

  29\. Vegetable Products           5276           5908       9239       861            663        682

  30\. Other Crop Products          6916           9047       12260      17257          21596      21440

  **Total II (15-30)**              35652          55387      68852      41187          46004      43490

  **III. Other Products**                                                                           

  31\. Coffee, Cocoa, Tea           1526           1743       1597       747            864        748

  32\. Tobacco & Preparations       24             10         0          14596          22521      5049

  33\. Spirits & Alcoholic Drinks   23976          28258      35007      3420           4236       5474

  34\. Water & Non-Alcoholic Drinks 1682           2365       3471       321            178        209

  35\. Other                        10             13         30         3175           3495       4395

  **Total III (31-35)**             27217          32390      40106      22260          31294      15875

  **Total (I+II+III)**              116245         150075     170438     81134          99081      91599
  --------------------------------- -------------- ---------- ---------- -------------- ---------- ----------

Table VIII: Quantity

  ----------------------------------- ---------- ---------- ---------- ---------- ---------- ----------
  **Polish Agri-Food Trade with the                                                          
  US**                                                                                       

  **Group/Commodities**               **Export                         **Import              
                                      (Tons)**                         (Tons)**              

                                      **2001**   **2002**   **2003**   **2001**   **2002**   **2003**

  **I. Animal Products**                                                                      

  **A. Live Animals (1-4)**                                                                   

  1\. Horses                          4          2          6          4          3          1

  2\. Cattle                                                           6          11          

  3\. Sheep                                                                                   

  4\. Other                           1          3          1          6          1          3

  **B. Processed Products (5-11)**                                                            

  5\. Red Meat &Offals                20         46         59         1597       4248       8440

  6\. Poultry Meat & Offals           0                                7533       2376       732

  7\. Meat Products                   7020       7748       6871       26         0          5

  8\. Animal Fats                     27         2          0          5          12         44

  9\. Milk, Cream, & Ice-Cream        590        353        661        237        60         20

  10\. Butter                         1908       190        112                               

  11\. Cheeses & Curds                2947       3685       4748       1          0          3

  12\. Other Animal Products          311        300        374        7060       8806       6047

  **C. Other**                                                                                

  13\. Fish & Crustaceans             1348       1684       1060       521        2316       4057

  14\. Fish Products                  1144       2887       1952       1          0          1

  **Total I (1-14)**                  15320      16900      15844      16997      17833      19353

  **II. Crop Products**                                                                       

  **D. Raw Materials**                                                                       

  15\. Cereals                        17         26         38         2550       5622       1914

  16\. Oilseeds                       4          10         13         2728       5683       1673

  17\. Fresh Potatoes                 0                                                       

  18\. Fresh Fruits                   43         14         12         9701       9178       8198

  19\. Fresh Vegetables               5          145        294        218        147        64

  20\. Flowers                        16         33         12         211        205        140

  **E. Processed Products (21-29)**                                                           

  21\. Vegetable Fats & Oils          211        262        404        40602      6498       2394

  22\. Cereal Milling Products        706        659        1014       32         23         22

  23\. Cakes & Meals                             0          5          1726       104        188

  24\. Starch, Croups, Malt           4936       13482      21289      2058       520        67

  25\. White Sugar                    116        105        165        0          1          21

  26\. Molasses                       42015      26578      37049      0          0          4

  27\. Confectionery                  2101       3669       3350       1066       933        1416

  28\. Fruit Products                 9184       18290      12911      3713       2142       2198

  29\. Vegetable Products             5716       6779       10903      745        603        408

  30\. Other Crop Products            3170       3892       4887       1644       2155       1422

  **Total II (15-30)**                68240      44983      23081      59826      33814      20129

  **III. Other Products**                                                                     

  31\. Coffee, Cocoa, Tea             715        769        545        295        689        599

  32\. Tobacco & Preparations         16         48         0          2142       3504       1593

  33\. Spirits & Alcoholic Drinks     14161      15733      19626      1696       1755       2042

  34\. Water & Non-Alcoholic Drinks   7646       10083      13654      116        65         81

  35\. Other                          7646       10083      13654      116        65         81

  **Total III (31-35)**               20         2          50         2088       3032       2869

  **Total (I+II+III)**                83580      61885      38975      78911      54679      42351
  ----------------------------------- ---------- ---------- ---------- ---------- ---------- ----------