The food industry will have to make significant efforts to overcome the international economic crisis. The players on the domestic market say that in the context of forecasted consumption decreases their only weapon is the price, which they will try to keep at the same level as before. At the same time, partnerships between companies in the same sectors are being taken into consideration, in order to prevent bankruptcies, while intermediaries will be cut off from any business, weekly Saptamana Financiara reports.

 

The forecasts regarding a decrease in the purchasing power determine the analysts to predict a falling consumption of staple foods, which means the market players will be directly affected. 'Most producers in the food industry have taken out loans and they will have to pay them back. The only advantage is that the food industry is unlikely to run out of customers. This means people will keep on buying foodstuffs, even if the consumption level will not reach the value it had prior to the crisis. But the consumers will take the price into account to a large extent and the manufacturers will refer to this behavior by adapting their strategies so that the customers should not notice a significant price increase. We shall have to tighten the belt as well', Executive manager of Romalimenta Mihai Visan said. In his opinion, 'producers depend on their customers and they will make efforts not to lose them, whereas the price will be the main element they will use for boosting sales.

 

At the same time, Visan predicted that in 2009 'the meat industry will try to survive so that it should not experience too significant losses'. The situation will be difficult next year, as the businessmen foresee a consumption decrease by some 2-3 percent. Moreover, they believe the market should be redirected to a range of less expensive products, as the consumers will think twice before buying. Regarding the wheat milling and bakery industry, Aurel Popescu, President of the Romanian Employers Association from the Wheat Milling and Bakery Industry (Rompan) said, 'everybody will be affected, but the large companies have the most to lose. They are operating based on loans, suppliers, etc. The more concentrated the business, the easier to be rescued'. 'Family-owned companies will overcome the crisis best', Aurel Popescu underscored. The oil price decrease worldwide causes problems to the companies pertaining to this industrial sector. They have already purchased the raw materials and are facing a dilemma: whether to sell at a loss, or wait for some market increase. 'Loans have been taken out and if you do not produce, you do not have the necessary resources to pay off your debts. While any demand reduction on the domestic market used to be covered by exports, now this is harder, as the product is sold at a price lower than the production costs. I have no strategy for the moment. Let's just hope we will overcome this situation',Cahirman of the Oil Employers' Associations Viorel Zichil told the weekly. At the same time, the next period will witness a clarification of the companies, as several mergers are to be concluded between companies in the same activity fields, and also partnerships between companies trying to support each other in order to survive. A

 

n example in this respect is to be found in the milk industry, as Alba Lact took over an 80-percent stake in Raraul Campulung Moldovenesc. The meat industry saw a recent merger of Transavia and Cerealcom Alba Iulia.