The Consortium for the Protection of Parmigiano Reggiano PDO runs for cover to try to stabilize the market, reducing production with the aim of closing the year in line with the performance achieved in 2019. The Consortium centralizes more than 115% of the Italian production of fresh milk to make a final product (3.75 million wheels last year) that is worth 1.5 billion euros to production, and 2.6 billion to consumption (over 40% export).
The King of Cheeses’ supply chain was turned upside down first by US duties and Brexit, which caused prices to fall by 30%, and then by the Covid-19 pandemic. The lockdown effect, on the other hand, has pushed domestic consumption to a very high level and pushed up prices in supermarkets. But this did not corresponds to higher revenues for farmers and dairies. The Consortium’s Board of Directors has thus launched unprecedented measures to stabilize the market.
THE CONSORTIUM’S STRATEGY
The Consortium has just decided to withdraw 16,000 wheels of Parmigiano Reggiano PDO from the market. “We will take on 15% of the September-December 2019 period production, maturing 16omila wheels in the warehouses at a fixed price of 8.25 euros per kg. In fact, 8 euros is the cost of production,” explains the president of the Consortium, Nicola Bertinelli.
To enhance the value of the product, the Consortium is also focusing on long maturing: the 40-month aged cheese will make its debut at Christmas. This year, 20 million euros in marketing investments aimed at promoting the ‘brand identity’ of the King of Cheeses have been spent.
Finally, a series of incentives and fines have been studied to induce dairies to reduce production.