Italy - Agricultural SectorItaly - Agricultural Sector

Overview
The Foreign Agricultural Service (FAS) is part of the U.S. Department of Agriculture (USDA) and is U.S. agriculture’s link to the constantly changing global marketplace.  Italy is the third-largest economy in the euro-zone, with a GDP estimated at $2.3 trillion and a per capita GDP of $38,200.  Being a net agricultural importer, most raw materials and ingredients are imported, as Italy’s economic strength is in the processing and the manufacturing of goods, primarily in small and medium-sized family-owned firms.  Italy exports mainly consumer products to the United States, while the United States exports mostly bulk commodities to Italy.  In 2018, U.S. agricultural, forest, and fish exports to Italy were $1.4 billion, while U.S. imports from Italy were $5 billion.  

Bilateral Ag Trade 2018

• In 2018, U.S. agricultural, forest, and fish exports to Italy were $1.4 billion
• In 2018, U.S. agricultural, forest, and fish imports from Italy reached $5 billion 

Source: BICO

Agriculture is one of Italy's key economic sectors, accounting for around 2.1% of GDP. Italy's agriculture is typical of the northern and southern division found within the European Union (EU).  The northern part of Italy produces primarily grains, soybeans, meat, and dairy products, while the south specializes in fruits, vegetables, olive oil, wine, and durum wheat.  Even though much of its mountainous terrain is unsuitable for farming, approximately 4% of the population is employed in farming.  Most farms are small, with the average size being eleven hectares.  Italy has a diversified industrial economy with roughly the same total and per capita output as France or the United Kingdom.  Italian industries, including the food-processing sector, rely heavily on imports of raw materials.  Italy is one of the largest agricultural producers and food processors in the EU. 

Best Prospects for U.S. Agricultural and Fish Exports
U.S. bulk and intermediate commodities are used as ingredients or inputs for value-added Italian products that are re-exported.  North American high-quality durum wheat, for example, is used to produce pasta.  Opportunities exist for beer, food preparations, condiments and sauces, baked goods, snack foods, almonds, and gluten-free products.  All sectors that have seen growth in recent years.   

Italian Food Importers and Retailers
Most imported food products enter the Italian market through brokers or specialized traders. Imported products from North America often enter Italy indirectly via the Netherlands' Port of Rotterdam or directly by air.  Wholesalers are the main customers for fish and seafood products, as they purchase and distribute to numerous small restaurants and hotels.  Most of the processed food and raw material sourcing decisions are made directly by the restaurant chef and/or hotel Food Purchasing Director.  Restaurants, hotels, and catering companies tend to rely on importers, wholesalers, and food manufacturers, while trattorias and pizzerias purchase directly from large retail food outlets.  While there are Category Associations for the Hotel and Food Service sectors, each establishment operates independently when it comes to sourcing decisions.

In Italy, the food retail and distribution sector is extremely fragmented and resistant to change.  Consolidation remains low and traditional grocery stores continue to represent the majority share of the outlets, followed by open-air markets.  In fact, the sector is one of the most fragmented and least saturated in Western Europe with fewer large retailers and many small local retail stores.   Nonetheless, consolidation is slowly gaining momentum, with Italian and foreign operators starting to expand their network of stores, particularly in the south of the country. 

Italian Food Processing Ingredients Sector
The Italian food processing industry continues to be highly fragmented, and depends almost entirely on imports of raw materials, many of which come from other EU countries.  Italian consumers continue to prefer fresh products rather than canned or frozen.  In Italy, the 10 leading food-processing companies account for around 40% of the sector’s sales, and growth areas include chilled ready meals, frozen pizza, soups, and healthy foods.  

The Italian Hotel and Food Service Industry
Every year more than 58.3 million tourists visit Italy, making it the world's fifth most attractive tourist destination.  The Italian Hotel and Food Service Industry is a lucrative and growing sector, however it is also diverse and fragmented.  Many small establishments dominate Italy, including bed and breakfasts, youth hostels, camping facilities, resorts, and rural tourism.

Food and Agriculture Import Requirements
To the extent that EU food laws have been harmonized, Italy’s food laws and regulations follow EU rules.  The main principle of the single market concept is to ensure that all food products, whether produced in the EU or imported from a third country, can move freely throughout the EU if they comply with uniform requirements.  In Italy, food safety is the primary responsibility of the Italian Ministry of Health, while food production is the primary responsibility of the Italian Ministry of Agriculture.  In some cases, other Italian Ministries may have responsibilities, such as the Ministry of Economic Development on standards, labeling and trade promotion, or the Ministry of Economy and Finance on customs and duties.

Please refer to the FAS Rome webpage for information on U.S. agricultural genetics, bulk and processed commodities, food and beverage products, market intelligence, and market sector briefs to help U.S. firms better understand the Italian market: https://it.usembassy.gov/embassy-consulates/rome/sections-offices/fas/

Contacts for the Foreign Agricultural Service office, Rome:
Office of Agricultural Affairs
U.S. Embassy
Via Veneto 119A
00187 Rome, Italy
Tel.: +39-06-4674-2396
Fax: +39-06-4788-7008
E-mail:  agrome@fas.usda.gov
Website:  https://it.usembassy.gov/embassy-consulates/rome/sections-offices/fas/