wp3 italian case study: local and global cured ham...

2014

WP3 – Italian case study: local and global cured ham

chains

www.glamur.eu 2

sk 3.5)

Authors – Partner

Italian case study: local and global cured

ham chains (Task 3.5)

Kees de Roest – CRPA

Stefano Pignedoli – CRPA

Giovanni Belletti – University of Florence

Davide Menozzi – University of Parma

Filippo Arfini – University of Parma

www.glamur.eu 3

Contents

1. Introduction ................................................................................................................................... 8

2. Description of the three chains ....................................................................................................... 8

2.1. Local Cinta Senese ham ....................................................................................................8

2.2. Parma Ham .................................................................................................................... 10

2.3. Generic cured ham ........................................................................................................ 12

2.4. Characterisation, system boundaries and mapping ...................................................... 13

2.4.1. Characterisation of the supply chains ................................................................... 13

2.4.2. System boundaries and mapping .......................................................................... 17

2.4.3. Local supply chain Ham of Cinta Senese meat PDO .............................................. 18

2.4.4. Regional supply chain Parma Ham ........................................................................ 19

2.5. Critical issues and relevant attributes/indicators .......................................................... 20

3. Research design ............................................................................................................................ 22

3.1. Research Questions ....................................................................................................... 22

3.2. Attributes and indicators selection process .................................................................. 22

4. Methods ....................................................................................................................................... 33

4.1. Added Value .................................................................................................................. 33

4.2. Resilience ....................................................................................................................... 36

4.2.1. Description of the attribute “resilience” and research questions......................... 36

4.2.2. Contextualization in the Cured ham supply chain ................................................. 39

4.2.3. Methodology ......................................................................................................... 41

4.2.4. Prices volatility indicators ...................................................................................... 45

4.2.5. Pig farm indicators ................................................................................................. 45

Analytical indicators .............................................................................................................. 45

Synthetic indicators ............................................................................................................... 47

4.2.6. Slaughtering indicators .......................................................................................... 47



4.2.7. Ham processing indicators.................................................................................... 48

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Synthetic indicators .............................................................................................................. 49

Cross-cutting indicators ......................................................................................................... 49

4.3. Chain governance .......................................................................................................... 50

4.3.1. Description of the attribute ................................................................................... 50

4.4. Territoriality ................................................................................................................... 54


4.4.2. Indicators ............................................................................................................... 56

4.5. Resource use and pollution ........................................................................................... 57


4.5.2. Indicators ............................................................................................................... 58

4.6. Affordability ................................................................................................................... 59


4.6.2. Indicators ............................................................................................................... 60

4.7. Data quality check ......................................................................................................... 61

5. Results (performances) ................................................................................................................. 67

5.1. Value added ................................................................................................................... 67

5.2. Resilience ....................................................................................................................... 72

5.2.1. Prices volatility results ........................................................................................... 72

5.2.2. Pig farming results ................................................................................................. 73



5.2.3. Slaughtering results ............................................................................................... 75


Synthetic indicator ................................................................................................................. 75

5.2.4. Ham processing results .......................................................................................... 77


Synthetic indicators .............................................................................................................. 77

Cross-cutting indicators ......................................................................................................... 78

5.2.5. Performance comparison ...................................................................................... 81

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5.3. Chain governance .......................................................................................................... 84

5.3.1. Indicator "Trust based internal relationships" ...................................................... 84

5.3.2. Indicator "Trust based external relationships" ...................................................... 85

5.3.3. Indicator "Self governance capacity" .................................................................... 86

5.3.4. Indicator "Chain-based value governance" ........................................................... 88

5.4. Territoriality ................................................................................................................... 91

5.4.1. Indicator “Social cohesion and conviviality” ......................................................... 95

5.4.2. Concluding remarks ............................................................................................... 98

5.5. Resources use and pollution ......................................................................................... 99

5.5.1. Results ................................................................................................................... 99

5.5.2. Conclusion ........................................................................................................... 108

5.6. Affordability ................................................................................................................. 109

6. Discussion on the research questions .......................................................................................... 115

6.1. Global-Local performance comparison (research question 1) .................................... 115

6.2. Global-local interactions (research question 3) .......................................................... 119

6.3. Methodological reflections (research question 2) ...................................................... 119

7. Annexes ..................................................................................................................................... 121

7.1. Annex 1– Volatility indicators and Analytical indicators results ................................. 121

7.1.1. Prices volatility results ......................................................................................... 121

7.1.2. Pig farming analytical indicators results .............................................................. 124

7.1.3. Slaughtering results ............................................................................................. 129

7.1.4. Ham processing results ........................................................................................ 130

7.2. Annex 2 – Methodological approach used for LCA ..................................................... 134

7.2.1. Parma pigs ........................................................................................................... 134

7.2.2. Cinta Senese pigs ................................................................................................. 137

7.2.3. Emissions ............................................................................................................. 139

7.2.4. Slaughtering for Parmapig and generic light pig ................................................. 139

7.2.5. Slaughterhouse for Cinta Senese pig .................................................................. 140

7.2.6. Ham factory for Parma and generic crude ham ................................................... 141

7.2.7. Generic crude ham seasoning .............................................................................. 141

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7.2.8. Ham seasoning company for Cinta Senese .......................................................... 141

7.2.9. Transport and retail ............................................................................................. 142

7.3. Annex 3 – Dataset for Attribute Territoriality ............................................................. 143

8. References ................................................................................................................................. 146

8.1.1. List of the main sources ....................................................................................... 150

www.glamur.eu 7

The research leading to these results has received funding from the European Union’s Seventh Framework

Programme for research, technological development and demonstration under grant agreement n° 311778

To be quoted as:

de Roest K., Pignedoli S., Belletti G., Menozzi D., Arfini F. (2014). Glamur project Italian

case study: local and global cured ham chains. CRPA.

GLAMUR Report – Italian Case Study- Pork Chains –March 2015

8

1. Introduction

Cured hams play a relevant role in Italian’s food habits. Italy is renowned worldwide for its

traditional hams protected by geographical indications (e.g., Parma, San Daniele, Toscano, which

are protected by a Protected denomination of origin – PDO), which play a very important role on

the consumer market.

These traditional hams are linked to restricted territories and to local traditions, but they are

produced on a large scale and largely manufactured according to intensive/industrial production

processes.

Next to these traditional hams on the market two main other types of hams are present. On

the one hand, hams cured in Italy but produced with fresh hams of foreign origin, very competitive

on price, and on the other hand, cured ham produced with traditional methods from local pig breeds

reared according to traditional criteria.

This report will examine the following three types of cured ham:

1. Traditional cured ham obtained from the meat of the Cinta Senese pig, a native breed of

Tuscany;

2. Parma Ham protected by a designation of origin (PDO);

3. Generic non-PDO cured ham produced with fresh hams imported from abroad.

2. Description of the three chains

2.1. Local Cinta Senese ham

The Cinta Senese is an Italian native breed widespread in the region of Tuscany. This breed

after a long period of crisis that had brought almost to its extinction, is now recovered and out of

danger. Thanks to agro-environmental measures, technical assistance and a re-valorization of its

products on the market, farmers have reintroduced this native breed again spreading it throughout

Tuscany (and also in nearby regions) and preserving traditional ways of farming. In 2010, according

to ANAS, statistics report the presence in Tuscany of 120 farms with about 980 sows registered in

the official Herd Book.

The farming system is based on the pasturing of the pigs on meadows and/or in the forest.

However, there are farms that use buildings housing the sows during farrowing and weaning. The

Cinta Senese is characterized by the high quality of its fresh meat, which is both consumed fresh

and processed into high quality “salamis” and cured ham.


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A PDO for the fresh meat of Cinta Senese was registered by the Reg. UE 217 (17.03.2012

published in the EUOJ L 75, 15.03.2012), long time after the first submission of the application

(06.09.2005). According to the product specifications, the PDO designate the meat of pigs of Cinta

senese breed reared in Tuscany region that are the offspring of pigs which are both registered in the

population register and/or the herdbook of the genetic type “Cinta Senese”. Pig farmers of Cinta

Senese from other regions where the breed is bred (in particular Umbria) have opposed this

geographical demarcation.

As far as the method of production is concerned, the PDO product specification states that

the animals intended for slaughter must be reared in the wild/semi-wild once they are four months

old. The maximum limit per hectare is 1,500 kg live weight. The pigs must be allowed to forage

daily in areas of land that are either fenced off or not, and that may include shelters for the night

and/or for inclement weather. Breeding sows and boars may be housed in appropriate structures

(pens) in the mating period and pre- and post-partum to facilitate health controls and farrowing.

It should be noted that some farmers breed Cinta Senese pigs bred outside the requirements

of the Product specifications. This fact, in principle, should prevent the opportunity to name the

product “Cinta senese”. In fact, according to a decree of the Italian Ministry of Agriculture, all the

breeders of Cinta Senese pigs in purity may indicate on the label "product obtained from pigs of

Cinta Senese", regardless of the place of rearing and of breeding technique used. In this way the

effectiveness of the designation of origin is greatly reduced.

Pasture in the forest is carried in more than half of the farms. The sows are kept outdoors

(65% of cases), but 75% farrow in boxes. The typical farm business (38% of farms) has a number of

sows that varies between 6 and 15 animals. 29% of the farms have a herd size of 1 to 5 sows. The

most significant class (16-50 sows) represents 21% of the farms. This is an economically

sustainable herd size, as the smaller farms rely primarily on income from other agricultural

activities (wine, olive oil). On farms with more than 50 sows (12%) the livestock activity is

considered an opportunity for capital investment. On these farms the processing of the fresh meat is

quite common.

The forest, if present, is used for pasturing during the whole year on 70% of the farms. The

natural and artificial pastures are less used: 50% of farms do not use them. The pigs are normally

slaughtered after 18-24 months, with a weight of about 150 kg.

Past studies have shown that, in some cases, the forest was considered to be a simple

container of pigs and not used as a supply of feed. During the fattening phase 80% of the energy

need is covered by concentrate feed and only the remaining 20% is covered in a natural way with

the acorns of forest.

According to Franci et al. (2011), four categories of farms can be distinguished:

1. The traditional farmer tied to the land and the environment that leads to sustainable

production with moderate number of animals.

2. The hobby farmer who wants to exploit the forest without having the necessary

knowledge to manage the profitable production.


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3. The very experienced farmer, who looks for innovative solutions for example in the field

of genetic selection and knows how to exploit the commercial channels and care of the image of the

product.

4. The farmer-entrepreneur, paying less attention to environmental constraints, is involved in

the entire supply chain and looks for new potential markets.

According to these different models, some problems of negative environmental impacts in

the forests, due to an excessive load of animals, are reported.

The Cinta Senese meat is used for both fresh consumption and for the production of various

types of traditional Tuscan salami, Among these, the cured ham has a particular positive reputation

in Tuscany and outside. About 70% of the farmers join the Consortium of Cinta Senese and 60% of

the farmers is also processing the fresh meat.

The Consortium of the Cinta Senese meat PDO has registered a collective private quality

hallmark granted to the Consortium members to ensure sausage products and hams made using only

meat Cinta Senese PDO.

The cured of the Cinta Senese ham includes always the paw (like San Daniele ham).

According to these different models, some problems of negative environmental impacts in

the forests, due to an excessive load of animals, are reported.

2.2. Parma Ham The production chain of Prosciutto di Parma PDO involves 4286 breeding farms, 129

slaughterhouses and 150 processors (Prosciutto di Parma PDO Consortium, 2013). The “Prosciutto

di Parma” (Parma Ham) PDO is produced in Parma, in Emilia-Romagna region; all Parma Ham

PDO authorized producers must be located within the geographical boundaries of the Parma

production area (i.e., 5 km south of the via Emilia, limited to the east by the river Enza and on the

west by the river Stirone, and up to an altitude of 900m). The pigs used in the production of Parma

Ham PDO must be bred in one of ten northern and central Italian regions. However, more than 85%

of the pigs are bred in only three Northern Italian regions (i.e., Lombardy, Emilia-Romagna and

Piedmont). Only three breeds of pigs can be used for Parma Ham: Large White, Landrace and

Duroc. The Parma Ham pigs are fed with cereal grains and, in some local cases, whey from the

production of Parmigiano-Reggiano PDO and Grana Padano PDO cheeses. The 150 processing

companies have produced 9, 087,000 branded hams in 2013. The value of the ‘‘Prosciutto di

Parma’’ is 740 million euro at wholesale prices and 1.56 billion euro at retail prices (Prosciutto di

Parma PDO Consortium, 2013). Overall, approx. 28% of the production is exported. Britain is the

largest international market for Parma Ham with more than 300,000 hams and over 18 million per-

sliced packs sold annually (Prosciutto di Parma PDO Consortium, 2013).

Processing

During the last decades the ‘‘Prosciutto di Parma’’ production system has experienced a

deep technical innovation. Traditionally, the unique conditions of the Parma geographical area have

made it possible to produce the highest quality hams. The processing methods, first artisanal and


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linked to rural traditions (e.g., curing ham during the winter season, salt from the wells of

Salsomaggiore, pigs fed with whey from the production of Parmigiano-Reggiano PDO cheese, etc.),

changed dramatically during the ‘70s with the introduction of the refrigerated holds (the cold

storage room) and new skilled, specialized and highly experienced workers (e.g., salters, de-boners,

etc.). The technical development involved also mechanical firms inside the Parma territory that

designed new machineries for the curing industry.

The breeding phases are defined as follows: suckling during first four weeks with the sow;

weaning, from the 5th to the 12th week; piglet fattening, from 30 to 80 kilograms of weight; and

fattening: from 80 to 160 kilograms of weight and above. The minimum slaughtering age is nine

months. Producers of Parma Ham PDO receive fresh legs from authorized slaughterhouses (from

the same ten Italian regions) on a weekly basis; the average weight is around 15 kg. The legs are

first salted by a highly trained skilled worker; the pigskin is covered with humid sea salt, while the

muscular parts are covered with dry salt. Salt is the only preservative used in the processing

method, no chemical elements are allowed. This is another big difference from other generic hams,

normally containing nitrites and nitrates.

Next the hams hang for 70 days in refrigerated, humidity-controlled rooms. The meat

gradually becoming darker and harder. Around seven months after the salting process the ham is

smeared with a mixture of rice flour, salt, and pork fat called ‘sugna’ to stop it drying too quickly

for the remainder of its maturation. After air drying the ham it is moved to the cellar to start the

maturation process. The designation of origin ‘Parma Ham’ is reserved for hams cured for at least

12 months from salting. It is checked with a long horse bone needle to assess its quality and

maturity. Once approved, it is branded with the authentic five-point Ducal Crown firebrand. Some

hams can be cured for up to three years.

The sliced and packaged in tray Parma Hams PDO represent the more recent innovation.

This process, that must be performed in authorized plants within the geographical boundaries of the

Parma production and under the supervision of independent certification body, now accounts more

than 10% of the total quantity produced.

The Parma Ham PDO Consortium and guarantee system

The Parma Ham Consortium was set up in 1963 by 23 ham producers (originally called

“Consorzio Volontario fra i Produttori del Prosciutto Tipico di Parma”, i.e., “Voluntary Consortium

of Typical Parma Ham Producers”). Its role is to ensure and certify product quality, authenticity and

production methods. The Consortium tasks involve the management and safeguard of the Parma

Ham PDO specification, management of the economic policy (strategies, trends and macro-

economic policies), definition and monitoring of quality control schedules (to check that hams meet

the quality requirements), protection and promotion of the denomination “Parma Ham” and brand

(Ducal Crown) world-wide, and assistance to associated companies through advisory services and

other support.

A rigorous traceability system has been set up to guarantee the authenticity of the Parma

Ham PDO (Mancini, 2003). Every stage of the quality control plan can be tested by brands and

seals, and proven by documents. The breeder puts a special tattoo on both legs of the young pig

within 30 days of birth, showing the breeder’s identification code and a code indicating the month


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of the animal’s birth. In slaughterhouse every fresh trimmed leg is checked and branded with a

mark permanently identifying it, including the initials “PP” and the slaughterhouse identification. In

processing plants, the metal seal made up of a circular crown showing the C.P.P. (“Consorzio

Prosciutto di Parma”) initials and the date curing began. Finally, the five-point Ducal Crown brand

is stamped under the strict control of the independent organization inspectors (i.e., I.P.Q. Istituto

Parma Qualità) and is the final guarantee of the quality of the ham. The Ducal Crown also shows

the identification code of the producer. The I.P.Q. is an independent organization which objectively

controls and verifies the origin and traceability requirements, monitoring the compliance of raw

material quality and manufacturing process (Mancini, 2012).

The producers of Parma Ham PDO

The companies producing Parma Ham PDO are involved in competitive and cooperative

relations based on mutual trust (Arfini and Mora, 1997). During the last decades, new companies

entered the Parma Ham PDO Consortium and many organization members started to produce non-

PDO hams within the same area (see Case 1: Global supply chain generic non-PDO cured ham).

Many companies complain about the lack of vertical quality differentiation within the PDO

specification. Although the possibility to define a higher regulated level of label differentiation

between the current PDO and a ‘‘higher quality’’ version of the PDO has been suggested by many

authors (see e.g., Mancini, 2003; Dentoni et al., 2012), this strategy still lacks of the Consortium

general consensus to be introduced in practice (Giacomini et al., 2013a). Thus, many companies

have developed their individual brand, often displayed next to the PDO label and the Consortium

brand, to differentiate their products from competitors. The individual brands often distinguish

specific attributes of the company’s ham, like the curing period length, since the PDO specification

set the minimum requirements that “Prosciutto di Parma” hams must meet. In other cases, however,

the individual brand does not provide any special guarantee to consumers, except those linked to the

company’s reputation. For these reasons, the PDO label (“Parma Ham”) and the Consortium

collective brand (the ‘‘five point Ducal Crown’’) generally overwhelm the marketing power of

companies’ individual brands (Mancini, 2003; O’Reilly et al., 2003).

Two types of companies coexist within the Consortium of the Prosciutto di Parma with

different business strategies (Dentoni et al., 2012): the small firms and the large groups and

corporations. The first concentrate their activity almost exclusively on the production of the

Prosciutto di Parma PDO, aiming to differentiate the quality of their product from the competitors,

whilst the latter consider the PDO ham as a part of their own product mix. The decisions that are

made within the Consortium are the result of the coexistence of these two kind of companies, which

may have very different positions (Giacomini et al., 2013a). This heterogeneity and its implications

have been discussed by Dentoni et al. (2012).

2.3. Generic cured ham This supply chain refers to hams produced in the same geographical area as the Parma Ham

PDO, often by the same companies producing the PDO ham, but without meeting the requirements

set by the Parma Ham Consortium. During the last decades, new companies entered the Parma Ham


13

Consortium and many members of this Consortium started to produce non-PDO hams within the

same area, using the same knowledge, skills and facilities of the Parma Ham production. The

decisions that are made within the Parma Ham PDO Consortium are influenced by these companies

too (Giacomini et al., 2013a).

Although there are no official figures about the non-PDO hams production and the number

and characteristics of the companies involved, it has been argued that the non-certified (by GI

designation) hams production has exceeded in quantity the PDO one (Giacomini et al., 2013a). It

has been estimated that approximately 15 million non-PDO hams were produced in 2009 within the

same territory of the Parma Ham (Parma Province). The firms producing some quantity of non-

PDO Parma Hams within the traditional PDO area of production are approximately 190. Many of

these companies are producing both Parma Ham PDO and non-PDO hams. However, the

concentration ratio of the non-PDO production system is much higher than the PDO one. It was

estimated that 10% of the major companies involved in the production of non-PDO hams accounted

for, approximately, 60% of the total non-PDO production (compared to 33% of the PDO hams).

These non-PDO hams are produced mostly using foreign meat (i.e., the so-called “foreign

ham”) and in minimal part using residual meat of the PDO chain (i.e., the so-called “national ham”).

Many Parma Ham producers suffer the competition of the generic non-PDO hams, complaining that

this huge production negatively affects the market price of the Parma Ham PDO (Giacomini et al.,

2013a). This production aims to exploit the Parma Ham reputation while being marketed at lower

prices. In fact, the non-PDO production costs are around 20-25% lower than the PDO ones. The

slaughtering age of the pigs is lower than for the PDO chains: six-seven months, instead of at least

nine months. This shorter breeding period leads to lower breeding costs (e.g., labor, feeding costs,

etc.). The absence of certification and monitoring processes throughout the supply chain, typical of

the PDO specification, as well as the possibility to use chemical elements such as nitrites and

nitrates as preservative in the processing phase and the shorter curing period, reduce significantly

the overall production costs (both operating costs and financial exposure) of the non-PDO hams.

The distribution channels are similar to those of the Parma Ham PDO; moreover, in-store the non-

PDO ham benefit from the consumers’ difficulty to distinguish between the two products

(Giacomini et al., 2013a). The non-PDO generic hams, being smaller than the PDO ones, can be

more easily sliced and packaged in a tray than the Parma Ham PDO.

2.4. Characterisation, system boundaries and mapping

2.4.1. Characterisation of the supply chains

The full description of the three chains Cinta Senese (local), Parma Ham PDO (regional) and

generic non-PDO cured ham (global) is presented in the table below.


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Table 2.1: Description of the tree chains of ham production in Italy

Local Regional Global

Product Category of

product (should

be the same for

the 3 case studies

as they are

forming a pair)

Cured Ham

Precise name of

the product

Prosciutto di Cinta

Senese (Cinta Senese

Ham)

Prosciutto di Parma

(Parma Ham PDO)

Prosciutto crudo (generic

non-PDO cured ham)

Scope of the

case study

Arguments for

choosing this

case study

The ham is produced in

small companies with

the thighs of the Cinta

Senese pig in Tuscany.

Animals are kept

outdoors and fed mainly

with local foods.

The ham is a PDO

product produced in a

small area, with fresh

meat from North and

Central Italy, and

marketed globally.

The ham is produced

with imported thighs,

cured in the same region

than the Parma Ham

PDO and marketed

globally

Controversy

addressed by the

producers, the

consumers,

and/or the public

opinion

- Producers’ have strong

influence on the

governance of the chain,

also by means of the

PDO

- Recovery of the race

Cinta Senese, but with

some environmental

problems due to

inappropriate breeding

techniques

- Great variability of the

raw material and

difficulty of ensuring

consistent production

standards

- Lack of collaboration

between producers,

slaughterhouses and

processors

(heterogeneity of

Consortium members)

- Tendency of large

processors to produce

Parma Ham PDO at the

lower edge of the

product specification, as

well as other generic

non-PDO hams

- Small firms specialized

in Parma Ham PDO

production, aiming to

differentiate the quality

-

- The huge production of

more competitive

generic hams could drive

down the price of the

PDO Hams

- Often the same

companies are producing

both the Parma Ham

PDO and the generic

non-PDO hams

(members of the Parma

Ham PDO Consortium

too)

- Consumers’ difficulty

to distinguish between

the Parma Ham PDO and

the generic non-PDO

hams, especially on

export markets

Dimension(s) for

which the case is

most relevant

Creation and distribution

of added value

Biodiversity (Cinta

Senese breed

preservation)

Resource use (woods)

Animal wefare,

Health (fat with high

omega-3 content)

Environmental (intensive

pig farms), Economic

(distribution of value

added), Ethic (animal

welfare), Governance

(Consortium

heterogeneity,

traceability), Consumer

behavior (WTP for PDO,

high quality PDO, and

generic hams),

Technological

innovation (pre-sliced

hams)

Environmental (intensive

pig farms) Economic

(distribution of value

added), Ethic (animal

welfare), Consumer

behavior (WTP for PDO,

and high quality PDO

hams, and generic

hams), Technological

innovation (pre-sliced

hams)

Exact definition

of the Product

Prosciutto di Cinta

Senese (Cinta Senese

Ham)

Prosciutto di Parma

(Parma Ham PDO)

Prosciutto crudo (generic

non-PDO cured ham)

Very short

characterisation

See maps


15

Supply-

chain

description

of the supply-

chain (flow-

chart)

Number and

characteristics of

farmers involved

(if known)

In 2010, according to

ANAS, statistics report

the presence in Tuscany

of 120 farms with about

980 sows of Cinta.

Out of them, around 80

farmers are registered in

the PDO system.

4,286 pig farms (these

farms provide pigs not

only to the Parma Ham

PDO, but also to other

Italian PDOs – e.g., San

Daniele)

not available

Number and

characteristics of

producers down-

stream in the

supply chain

Around 30

slaughterhouses and

cutting plants (all in

Tuscany) registered in

the PDO system

129 slaughterhouses

150 processors

N. slaughterhouses not

available

190 processing firms

(very concentrated

production: 10% of the

companies accounted for

60% of the total non-

PDO production)

Marketing

channels

Sold directly to

consumers, supermarket,

small retailers

Supermarkets, small

retailers, ho.re.ca.

Supermarkets, ho.re.ca.

Geographical

scope of the

supply chain

Feed arrives at least for

60% from Tuscany.

Sales 100% locally or by

short channels

Feed primarily imported,

farms in 10 regions of

Italy and processors in

delimited area south of

Parma, marketing

globally

Imports of thighs from

N-Europe, processing in

delimited area,

marketing globally

Supply-

chain

analysis

Governance of

the supply chain

(power relations,

collective

organization,

etc.)

The farmers’ and

processors of Cinta

Senese are represented in

the “Consorzio di tutela

della Cinta Senese”

(Consortium for the

protection of the Cinta

Senese)

‘

Consorzio Prosicutto di

Parma, is the association

of ham producers which

comply with the PDO

product specification

Other production phases

can also be represented

with the Consortium

(i.e., breeding farms,

slaughterhouses)

no formal governance

Main

organizational

patterns

A third body INEQ

controls compliance with

the PDO product

specification for fresh

meat. The Consortium

controls the use of PDO

Cinta meat for sausages

and hams by the

associated firms,

guaranteeing the

traceability of the fresh

meat. The Consorzio

provides for a quality

hallmark for the

- An independent

organization (IPQ)

controls compliance with

the product specification

for fresh meat

- Strict traceability

system, along the supply

chain:

tattoo on piglets:

branded fresh meat:

no formal organization


16

processed products:

.

metal seal at the

beginning of the curing

period:

the five-point Ducal

Crown brand after 12

months:

Resources

(human/capital/

other) employed

in the production

process (generic

vs. territorial)

Relevant role of local

specific resources: the

local breed Cinta Senese

and breeding skills,

woods.

Industrial organisation of

the production process

with certain specific

production phases

carried out by artisans,

highly experienced and

specialized workers

(e.g., salters, de-boners,

etc.)

Fully industrial supply

chain

Knowledge

employed in the

production

process (generic

vs. territorial)

Extensive knowledge of

pasture management of

pigs in forests.

Long lasting experience

in processing meat of

this particular pig breed

Several processing phase

are performed manually

by artisans, highly

experienced and

specialized workers

(e.g., sugnatura, salters,

etc.)

Same knowledge

employed in the Parma

Ham PDO production

(knowledge spillovers)

Technologies

employed in the

production

process (generic

vs. territorial)

Extensive livestock

grazing, traditional

processing techniques

Industrial processing (no

chemical additives in the

processing phase), sliced

and packaged in a tray

PDO hams

Industrial processing

(chemical elements used

in the processing phase,

e.g. nitrites and nitrates),

sliced and packaged in a

tray non-PDO hams

Role of the

territory (in all

dimension:

geographical,

cultural and

economic) in

defining the

identity of the

product

Very relevant. The bred

Cinta Senese is typical of

the central hills of

Tuscany; the Tuscan

identity of the product is

recognized and protected

by means of the PDO.

The production of Parma

Ham is traditionally

associated with the

territory of Parma

The cured ham produced

in the same territory than

the Parma Ham PDO is

promoted by the

company as a valid

lower priced substitute

of Parma Ham

Role of public

policies and

institutions

Subsidies and technical

assistance for the

preservation of the

breed.

Subsidies for

investments, hygiene and

veterinary controls

Subsidies for


veterinary controls,

subsidies from Rural

Development Plan (e.g.,

gourmet food route) but

not for farmers

Subsidies for


veterinary controls


17

Main dynamics /

trends

Increase in the number

of livestock reared.

Actually the demand for

Cinta Senese meat

exceeds supply.

Exports continue to

grow, but the domestic

market is declining

Reduction in the

number of processors

(increased concentration

ratio)

Domestic market is

declining, but exports

are increasing

Reduction in the

number of processors

(increased concentration

ratio)

In the following table the three chains are characterized on the basis of the four dimensions that,

according to the GLAMUR approach, characterizes local and global chains:

Table 2.2. Characterisation of the supply chains

Local Regional Global

Cinta Senese Ham

PDO

Parma Ham PDO Generic cured ham

Physical/geographical

distance

Fresh meat from

Tuscany, in some cases

processed on farm, the

most part of feed local

or from Tuscany

Fresh meat from North

and Central Italy, local

processing,

consumption in Italy

and abroad

Imported fresh meat

from Northern Europe

(e.g. NL), any origin

livestock feed, sales in

Italy and abroad

Governance/organizati

on (control by local

actors)

Controlled by local

farmers and processors,

in some cases all the

production and

processing is made

inside the same firm

Governance role of the

Consortium (members’

heterogeneity, local

and global processing

firms involved)

Supply chain

controlled by larger

global firms at

downstream level

(processing and retail

phase)

Technology and

knowledge

Traditional breeding

and processing.

Relevant role of local

specific resources: the

local breed Cinta

Senese and breeding

skills, wood

Mixing of traditional

way of production

(processing phase, e.g.,

no additives, highly

skilled work) and

modern ones (breeding,

curing)

Modern technology,

industrialization in all

phases of the chain. No

role for local specific

resources.

Identity of the product Ham of Cinta Senese

meat PDO

Parma Ham PDO General non-PDO

cured ham (often sold

with companies’ brand

or private label)

2.4.2. System boundaries and mapping

The main phases in production process which delimit the system boundaries of the three supply

chain are presented below:


18

2.4.3. Local supply chain Ham of Cinta Senese meat PDO

Figure 2.1. Material and production flows in the local supply chain of Cinta Senese

Spatial Scale Production inputs Agricultural Production

Primary

processing

Secondary

processing Distribution Retailing Consumption

Local land farms:

water manure/slurry Direct sales

feed pigs Local stores

workers Restaurants

Regional pig Slaughterhouse: Ham factory:

feed evisceration trimming Restaurants

workers cutting salting Gourmet stores

chilling ageing Regional supermarkets

Direct Internet sales

National

energy Gourmet stores

feed Restaurants

machinery Direct Internet sales

equipment

Continental

feed Gourmet stores

equipment Restaurants

machinery Direct Internet sales

energy

Global

equipment

machinery

feed

Transport

Transp

ort

Transport

Farm / local Feed

INTEGRATED MODEL: On-farm processing (slaughtering committed to external firms)


19

2.4.4. Regional supply chain Parma Ham

Figure 2.2. Material and production flows in the regional supply chain of Parma Ham

The Parma Ham PDO area of production.

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Number of Pigs< 100.000

100.000 - 200.000

200.000 - 1.000.000

1.000.000 - 2.000.000

> 2.000.000

Slaughterhouses# 1 Dot = 1 firm


20

Figure 2.3. Material and production flows in the global supply chain of generic cured ham

2.5. Critical issues and relevant attributes/indicators

Several critical issues emerge from the analysis and will be analysed in the comparison of the three

supply chains. The most relevant ones are:

Provenance of the meat for ham production. The three supply chains have a very different

geographical scope and organizational models, with different associated impacts linked to

transportation costs and other environmental impacts.

Breeds of pigs used in the production process (agro-biodiversity). In the global chain the

meats are obtained by pigs of different international breeds. In the Parma Ham PDO chain

only three breeds of pigs can be used: Large White, Landrace and Duroc. In the case of

Cinta Senese there is a relevant contribution to biodiversity preservation.

Environmental impacts. Different kinds of impacts are associated to the three supply chains.

In the case of Cinta Senese, the breeding systems in the forestis in principle a low-impact

process, but some concerns emerge due to environmental damage in the forest in case of

excessive number of animals per hectare. In other two cases some problems emerge due to

the high concentration of animals per hectare.

Governance. In the global chain there is no formal definition of quality; meats are imported

from Northern Europe and processed locally, using industrial processing methods (e.g.,

adding chemical preservatives). In the Parma Ham PDO chain the product quality is set by

the PDO specification (e.g., no chemical preservatives used). The guarantee system is also

defined by law; the Consortium has a significant role in governing the quality system.

However, the heterogeneity of Parma Ham Consortium members characteristics, have


21

important effect on the Consortium strategies. For example, several ham producers complain

about the lack of vertical quality differentiation within the PDO specification. In the Cinta

Senese supply chain there is a problem of quality variability of the meat produced by the

farmers, as they use different techniques and this affects the quality. It is a typical feature of

local artisanal products which also be considered an advantage compared to standard

products if the market is segmented properly.

Animal welfare. In the global chain the medium slaughtering age is six-seven months. They

are generally bred in highly mechanised livestock farms (intensive pig farming). In the

Parma Ham PDO chain, the breeding technique is also performed intensively in highly

mechanised livestock farms: piglets suckling during first four weeks with the sow; weaning,

from the 5th to the 12th week; piglet fattening, from 30 to 80 kilograms of weight; and

fattening: from 80 to 160 kilograms of weight and above. The minimum slaughtering age is

nine months. Health problems of the farming of the Cinta Senese seem to be lower than the

intensive rearing of improved breeds, while the well-being seems to be much higher.Some

limited problems emerge due to the contact with wild animals (wild boars and wolves).

Participation of farmers to the added value distribution. In the global chain the production

of non-PDO hams is highly concentrated in few large companies. While the product being

more competitive than the Parma Ham PDO, the value added is not evenly distributed.

Downstream stages (large scale processors and retailers) generally benefit from large share

of value added. In the Parma Ham PDO chain, the value added is not evenly distributed,

where downstream stages generally benefit from large share of value added. Large scale

slaughterhouses, processors and retailers are the players with higher bargaining power

throughout the supply chain. The PDO system in the case of Cinta Senese in principle allow

for a good farmers’ participation to the value added distribution. This is true in particular for

farmers which integrate all the phases of the chain in its own firm, up to the cured ham

production and its direct selling to consumers. For other farmers some problems emerge for

market prices, due also to some oversupply (high prices over the last few years pushed many

farmers to breed Cinta Senese, but without real marketing perspectives).

The role of public policies. In the global chain, processors in the Parma province benefit

from spillovers of the PDO production system, including public support for investments, etc.

In the Parma Ham PDO chain, the public support included subsidies for investments,

hygiene and veterinary controls. Indirectly, ham producers benefit from Rural Development

Plan (e.g., gourmet food route). For Cinta Senese public polices play a relevant role, first of

all for the recovery of the breed: both technical support and incentives paid in the

framework of agri-environmental measures in the Regional rural development plan (now

stopped).

Consumer preferences. In the global chain, the non-PDO hams have generally lower prices;

consumers in some cases (e.g., ho.re.ca) are not able to distinguish between the Parma Ham

PDO and the generic non-PDO hams. In the Parma Ham PDO chain, the consumer behavior

and preferences are relevant in shaping the WTP for PDO-labeled hams, high-quality PDO

hams, and generic hams.


22

3. Research design

3.1. Research Questions

Three general RQ common to all case studies

1. What are the key food chain performance issues with regards to a global-local comparison?

2. What is the methodological strength and weakness of overall applied pairwise comparative

analysis?

3. What are the specific interactions of the food chains under study and the policy settings?

Next to the three overarching research questions which are common to all case studies a set of

research questions have been formulated together with the NL team:

1. How to characterize and distinguish the 6 selected pork chains in terms of local versus

global in line with the criteria as agreed upon in GLAMUR?

2. How to characterize and distinguish the 6 selected pork chains in terms of local-global

dynamics?

3. What are most significant and meaningful dimensions, attributes and indicators to assess,

measure and compare the performances of the 6 selected pork chains?

4. How do the 6 pork chains perform on these indicators?

5. To what extent and in which ways do pork chain stakeholders agree or disagree about

relevant performance dimensions, -attributes and -indicators?

6. How are selected pork chains performances influenced by prevailing policy- and wider

regulatory frameworks?

7. What is the methodological strength and weakness of overall applied double pairwise

comparative analysis with its specific combination of quantitative and qualitative

approaches?

3.2. Attributes and indicators selection process

In line with point 3.3 “Indicators selection” of WP3 Guidelines for case studies, the relevant

attributes and indicators for Italian case studies were selected by means of experts and stakeholders

advice. Following the experts meeting held in Reggio Emilia on July 8th

, a first list of attributes and

performance indicators for Italian case studies (Cinta Senese PDO, Parma Ham PDO and generic

ham) was defined, including 7 attributes and 21 indicators. This first provvisional list is provided in

the table below.


23

First provisional list of attributes Attribute Indicators

Affordability Retail price

Dynamics in pork consumption

Dynamics of pig meat consumption

Added value Added value at farm level/AWU

VA slaughterhouse/AWU

VA ham factory/AWU

Resilience

Volattility of concentrate price

Volatility of live pig price

Volatility of fresh ham

Volatility of cured ham

Degree of diversification

Degree of downstream integration

Labour relations Labour service coops

Non-EU workers

Labour scandals

Chain governance Degree of self governance

Animal welfare Animal welfare level

Territoriality

Degree of artisanility

Effectiveness of PDO

Events organised in the territory related to the product

Links with local touristic activities

The list has been discussed on August 1st with relevant stakeholders. In particular, Davide Menozzi

( UNIPRt) had a meeting with two representative of the Parma Ham Consortium. The aim of the

meeting was twofold: first, to discuss and agree with stakeholders the list of relevant attributes and

indicators to characterize the global vs. local chains. Secondly, to gather additional information

about the case studies (in particular, Parma Ham and generic ham cases) and, as much as possible,

to collect data useful to populate the database. The following points summarize the main issues

resulted:

in general, the stakeholders found the proposed list of attributes and performance indicators

pertinent with the case studies aims;

among those attributes not selected, the only one that would be relevant for the purpose of

the case studies would be “Traceability”. This attribute would help to distinguish the

certificated food chains (Cinta Senese and Parma Ham PDOs) from the generic ham.

Possible performance indicators able to define this attribute could be the number of

inspections by the certifying body, or the number of nonconformities. These data should be

appropriately weighted, for example, by the quantity of certified product in order to account

for the differences between the Parma Ham (large-scale) and Cinta Senese cases (small-

scale). The possibility to include this new attribute has been discussed by the experts

involved;

they also agree that the only official prices throughout the supply chain are those defined by

the Commodity Exchange, although not always in line with the actual prices defined by the

real transactions;


24

the Parma Ham Consortium will provide data and information about prices, trends of the

certified production, composition Consortium Board of Directors, events linked to the

territory and related participation;

the Parma Ham Consortium will not provide data on individual companies, for privacy

reasons. For such information, the experts should rely on companies balance sheets and

individual interviews;

they do not have specific information about the extent to which the ham producers have

contract with labour cooperatives. However, stakeholders agree that such cooperative

contracts are important especially in certain phases (e.g., ham treatment with pig fat), both

for small and large companies. Leporati claims that about 80% of the work in these phases is

done by cooperatives. They do agree that unions should have more information about this

issue;

according to the stakeholders the Parma Ham and generic ham differ mainly for the use of

nitrates in the hams curing (which is banned by the PDO specification), and for the curing

period, which is lower for the generic ham, ranging from a minimum of 6 months to a

maximum of 9 months. The latter factor also affects the permanence of the ham in the

different seasoning cells: the cells and the temperatures are the same as the PDO ham, but

the time in cells changes in relation to the lower seasoning period.

The following people of Parma Gam supply chains were interviewed and collaborated in order

to collect data useful for the evaluation of selected indicators:

n. 2 representatives of the Parma Ham Consortium, who provided information about the prices

and the quantity consumed of Parma Ham PDO and generic ham (attribute “Affordability”),

the number of events and visitors (Indicator “Social cohesion and conviviality”, attribute

“Territoriality”), as well as the “Governance” of Parma Ham PDO, and “Resilience” of

Parma Ham PDO and generic ham.

the director of the Gourmet Food and Wine Route “Strada del Prosciutto e dei Vini dei

Colli di Parma” (“Road of Ham and Wines of Parma Hills”) who gave information about the

“Links with local touristic activities” (attribute “Territoriality”);

n. 8 in-person in-depth interviews with Parma Ham producers and n. 2 in-person in-depth

interviews with meat processors – slaughterhouses (secondary data, published in Giacomini

et al. 2010; Giacomini et al. 2013a; Dentoni et al., 2012); who gave information about the

Parma Ham PDO and global chains on attributes “Governance”, “Territoriality”, and

“Resilience”;

n. 1 focus group with 9 consumers, n. 20 in-depth direct interviews, and a survey with 250

consumers (secondary data, published in Capelli et al., 2014), who provided information

about the “consumers’ perception” of global and Parma Ham PDO chain (attribute

“Affordability”).


25

As far as Cinta Senese supply chain is concerned, three main sources of information were used

for identifying relevant attributes following the list provided by WP2 GLAMUR report:

1. Scientific literature analysis and other written sources: local newspapers (12 articles were

identified as relevant), grey literature and research reports, websites: a systematic analysis of

scientific literature and of local newspapers was developed in January-March 2014. See the

bibliography at the end of the Report.

2. Key informants interviews and exploratory interviews: a meeting with professors and

researchers of the Department of zootechnical sciences at University of Firenze prof. Oreste

Franci, dr.ssa Carolina Pugliese, and collegaues (Firenze, 06.02.2014), two meetings with

Cristina Santini president of the Consorzio di tutela della Cinta senese PDO (Firenze,

06.02.2014 and 23.04.2014), interviews to pig breeders and processors (Raymond Lamoth,

Castellina in Chianti; Fattoria di Pietrabuona, Pistoia; and Azienda Agricola Corboli, Prato).

The following people were interviewed and collaborated in order to collect data useful for the

evaluation of selected indicators:

the Director of the Cinta Senese PDO Consortium, who provided information about the

situation of the supply chain, the organization of the chain, market trends, and other main

issues relevant for the evaluation;

n. 3 in-person in-depth interviews with Cinta senese farmers and n. 3 with cured ham

processors, following a structured questionnaire: n. 3 They collaborate also to data

collection on costs and revenues of pig farming and processing;

n. 1 focus group (jointly managed with RETHNIK EU project) with representatives of firms

(farmers and ham processors: 7 people), PDO consortium (Director Chiara Santini), PDO

control body (president and Tuscan manager), public institutions (Toscana Region and

Province of Siena, 3 people), animal feed producers (1 people), researchers from Firenze

University (5 people).

A relevant contribution for the identification of critical attributes came from a Master thesis:

Lapenna M. (2014), “Valorizzazione dei prodotti tipici locali e effetti sulla sostenibilità ambientale:

il caso della DOP cinta senese, Laurea magistrale in Scienze dell’Economia, Università di

Firenze”. During the thesis work an analysis the local newspapers and 3 exploratory interviews to

farmers were developed, following the Glamur approach.

Thanks to these analysis, we have built the following matrix where relevant attributes are pointed

out according to different stakeholders categories who cited them.

Multi-criteria matrix of food supply chain performance Attributes

Stakeholders Economic Social Environmental Health Ethical

Pig farmers Profitability

(level and

stability)

Product quality

Landscape

preservation

Wood

preservation

Food safety

Animal welfare

Animal welfare


26

Ham

processors

Profitability

Product quality

Food safety

Scientists Landscape

preservation

Wood

preservation

Food safety

Animal welfare

Animal welfare

Policy makers Profitability

(level and

stability)

Economic

development

(both direct and

indirect: support

to development

of tourism)

Local/rural

developemnt

Biodiversity

Landscape and

wood

preservation

Food safety

Animal welfare

Fonte: Lapenna, 2014

The final selection of attributes has thus been based on an analysis of all attributes of the matrix

through literature review and participatory methods (interviews with stakeholders). The following

eight attributes have been analyzed. Some core attributes are common to both Country cases and

will be used for the comparison of the Italian and Dutch pork chains. Other attributes relate to just

one of the two cases.

Attribute

Italy Netherlands

Added value

X

X

Territoriality

X

X

Resilience

X

X

Resource use and

pollution

X

X

Affordability

X

X

Chain governance

X

X

The indicators were selected considering the following issues: their scientific soundness; the

appropriateness to the chains characteristics, and the availability of data. In table 3.1 indicators

indicators are presented, by giving a short definition and the indication of the data source.


27

The relevance of the selected attributes for the three chains is argumented in the following Section,

where also indicators are presented in a detailed way.

Table 3.1. Indicators

Main

attribut

e Name Definition Source

Value

added

Value added at farm

level

Value added per

kg of slaughter

weight on pig

farms

CRPA elaboration of Interpig data and

data collected by UNIFI

Value

added

Value added at

processing industry

Value added per

kg of cured ham

CRPA elaboration on representative

samples of firm balance sheets

Resilien

ce

V.1 - Feed prices

volatility index

Coefficient of

variation of

monthly feed

prices over 3 years

(concentrates

prices for heayy

and light pigs,

representative

agricultural

products for feed

for Cinta senese)

CRPA, Interpig, Chamber of commerce of

Siena data)

Resilien

ce

V.2 - Live pigs prices

volatility index

Coefficient of

variation of

monthly live pigs

prices over 3 years

(Heavy live Italian

pigs for B; Cinta

senese live pigs for

A; Light live pigs

imported from NL

not relevant)

ISMEA and Chamber of Commerce of

Siena data)

Resilien

ce

V.3 - Fresh ham price

volatility index

Coefficient of

variation of

monthly fresh ham

prices over 30

months (Fresh ham

14 kg for generic

ham ; Fresh ham

11-13 kg for

CUN data


28

Parma PDO ; not

relevant for Cinta

senese)

Resilien

ce

V.4 - Cured ham price

volatility index

Coefficient of

variation of

monthly cured

ham prices

Parma market data

Resilien

ce

A.1 - Farmers upstream

integration by ownership

% of pig farmers

which self-produce

the majority of

feed

UNIFI-UNIPR-CRPA

Resilien

ce


integration by

contractual

arrangements

Part of pig

farmers involved in

mid-long term

upstream

contractual

arrangements with

animal feed

producers

UNIFI-UNIPR-CRPA

Resilien

ce

A.3 - Farmers

downstream integration

Relevance of

farmers

downstream

integration

UNIFI-UNIPR-CRPA

Resilien

ce

A.4 - Farmers product

diversification

% of (light/

heavy/Cinta) pigs

for ham

production on the

total turnover of

farm

UNIFI-UNIPR-CRPA

Resilien

ce

A.5 - Farm-level

resistance against price-

volatility

Price volatility of

the input and

output markets of

relevance for pork

production,

defined as the max

delta added value

per kg live weight

per year over the

periode 2009-

2013

GLAMUR

Resilien

ce A.6 - Use of antibiotics

Use of antibiotics

in pig farms Expert consultation

Resilien

ce

A.7 -

Slaughterhouses/process

Part of

slaughterhouses/pUNIFI-UNIPR-CRPA


29

ors upstream integration rocessors involved

in pig farming

and/or in long

term contractual

arrangements

Resilien

ce

A.8 - Slaughterhouses


Relevance of

slaughterhouses

downstream

integration

UNIFI-UNIPR-CRPA

Resilien

ce


product diversification

Part of activity not

linked to

production of

generic / Parma

PDO / Cinta senese

ham on the total

turnover of

slaughtering firms

Expert consultation

Resilien

ce

A.10 - Processors

product diversification

Share of

processing firms

with a share of

(generic / Parma

PDO / Cinta

senese) ham

higher than 70% on

the total turnover

of processing

firms, on the total

number of firms

UNIFI-UNIPR-CRPA

Resilien

ce

A.11 - Processors

marketing channels

diversification for cured

ham

Degree of market

diversification of

ham processors, in

terms od

marketing

channels

UNIFI-UNIPR-CRPA

Resilien

ce

A.12 - Processors

geographical market

diversification for cured

ham

Degree of market

diversification of

ham processors, in

terms od

geographical

markets

UNIFI-UNIPR-CRPA

Resilien

ce

A.13 - Product

differentiation for cured

ham

Degree of product

differentiation for

cured ham by

means of collective

UNIFI-UNIPR-CRPA


30

labelling systems

Resilien

ce

S.1 - Farm-level risk-

spreading

Risk-spreading by

farm-level

diversification and

producing feed

Synthesis of indicators B1,B2 and D1

Resilien

ce

S.2 - Adaptation capacity

of farmers through

downstream actors

cooperation, integration

and diversification

strategies

Strength of

interlinkages with

downstream actors

diversification

strategies in terms

of productfolio -

and marketing

UNIFI-UNIPR-CRPA

Resilien

ce


of slaughtering firms

through integration and

diversification strategies

Synthetic indicator

based on

upstream,

downstream and

diversification

analytical

indicators

UNIFI-UNIPR-CRPA

Resilien

ce


of ham processing firms



Synthetic indicator

based on

upstream,

downstream,

diversification and

differentiation

analytical

indicators

UNIFI-UNIPR-CRPA

Resilien

ce

C.1 - Supply chain

attitude to diversification

and differentiation

Synthetic indicator

based on

diversification and

differentiation

analytical

indicators related

to all stages of the

supply chain

UNIFI-UNIPR-CRPA

Resilien

ce

C.2 - Intradiversity of

chain relations /

configurations

Diversity internal

to the supply chain

can improve the

resilience of the

system, thanks to

a diversification of

risks. Indeed

specific crisis

factors may

UNIFI-UNIPR-CRPA


31

embarrass some

models of chain

organization, but

not others

Resilien

ce

C.3 - Chain-based

adaptation capacity

through learning and

innovation

Chain actors'

collaborative

efforts to learn

and innovate

UNIFI-UNIPR-CRPA

Resilien

ce

C.4 - Ability to mobilize

public and societal

support

Presence of

political and social

support activities

of various types, at

national, regional

and local level

UNIFI-UNIPR-CRPA

Chain

Governa

nce

Trust based internal

relationships

Level of trust-

based relations

between chain

actors, based on

(1) absence of

conflicts, (2) trust

among chain

partners, (3)

continuity of chain

relations

UNIPR

Chain

Governa

nce

Trust based external

relationships

Level of trust-

based external

relationships

based on chain

partners' capacity

to mobilise

support from (1)

social movements),

(2) citizens and (3)

policy actors

UNIPR

Chain

Governa

nce

Self governance capacity Self-governance

capacity in terms

of creation of

distinctiveness

UNIPR

Chain

Governa

nce

Chain-based value

governance

Overall value

governance

characteristics

conform the

typology of Gereffi

et al. (2005)

UNIPR


32

Pollutio

n LCA.1 - Eutrophication

kg PO4-eq/kg live

weight

CRPA for regional and local /CLM* for

global

Pollutio

n

kg PO4-eq/kg

carcass weight


global

Pollutio

n

kg PO4-eq/kg

cured ham CRPA

Pollutio

n

kg PO4-eq/kg

sliced cured ham CRPA

Pollutio

n

LCA.2 - Carbon foot

print

kg CO2-eq/kg

live weight


global

Pollutio

n

kg CO2-eq/kg

carcass weight


global

Pollutio

n

kg CO2-eq/kg

curedham CRPA

Pollutio

n

kg CO2-eq/kg

slice cured ham CRPA

Resourc

e use

LCA.3 - Non renewabel,

fossil MJ/kg live weight


global

Resourc

e use

MJ/kg carcass

weight


global

Resourc

e use MJ/kg curedham CRPA

Resourc

e use

MJ/kg slice cured

ham CRPA

Resourc

e use LCA.4 - Water footprint

H2O m3/kg live

weight


global

Resourc

e use

H2O m3/kg

carcass weight


global

Resourc

e use

H2O m3/kg cured

ham CRPA

Resourc

e use

H2O m3/kg slice

cured ham CRPA

Resourc

e use LCA.5 - Land use

m2/year/kg live

weight


global

Resourc

e use

m2/year/kg

carcass weight


global

Resourc

e use

m2/year/kg cured

ham CRPA

Resourc

e use

m2/year/kg slice

cured ham CRPA

Territori

ality Association of product

with territory

Pig farms on total

farms with

livestock in the

territory (%)

IPQ/INEQ, ISTAT


33

Territori

ality Association of product

with territory

Pig meat

processing

industries on total

food industry in

the territory (%) IPQ/INEQ, ISTAT, UNIPR

Territori

ality

Association of product

with territory

Is there a link

between the origin

of raw material

(e.g. fresh meat,

feed) and the

territory? UNIPR, UNIFI

Territori

ality Social cohesion and

conviviality

Number of cultural

events in the

territory Parma Ham Consortium, UNIFI

Territori

ality Social cohesion and

conviviality

Number of visitors

in cultural events

in the territory Parma Ham Consortium, UNIPR

Territori

ality Links with local touristic

activities

Is there a Gourmet

Food and Wine

Route involved? UNIPR, UNIFI

Territori

ality

Links with local touristic

activities

% of farms

involved in on-

farm touristic

activities (agri-

tourism, food

tasting, etc.) UNIPR, UNIFI

Afforda

bility

Retail price in

supermarket € / kg Parma Ham Consortium, UNIFI

Afforda

bility Cured ham consumption Tons

Parma Ham Consortium, Cinta Senese

Consortium

4. Methods

4.1. Added Value

The capacity of producers and processors to add value to raw materials in order to

adequately remunerate their labour and capital is crucial for the economic sustainability of the

enterprise and of the production system. When producers and processors together compose the food


34

value chain, of importance is that a fair distribution of the total value added is achieved among the

economic actors of the chain.

Added value is calculated taking the difference between farm gate, wholesale and retail

prices and non-factor costs at each stage of the pork chain taking into account the valuation of the

pig carcass from producer to consumer.

When comparing local and global food chains one of the questions which emerge is to

which extent local food producers are able to capture more value added in the value chain in their

effort to directly reach the consumers. This argument may be used by the producers and processors

in the Cinta Senese chain.

A second hypothesis is that food products carrying a PDO label are able to generate more

added value than generic food products as PDO products can market also the “terroir” as food

attribute. Of interest is then to compare PDO Parma Ham with generic cured ham.

In global chains primary producers often complain to receive a minimal part of the value

added created in the chain because of asymmetric power relationships predominating in the chain.

The difference in value added per kg meat between Dutch light pig producers, which are at the basis

of the global pork chain, and Italian heavy pig producers, which dedicate their pigs to the PDO

Parma Ham circuit, is here of high interest.

Direct sales of processed Cinta Senese pork to consumers may affect value added as the

sales prices can be established without the influence of middlemen.

Within the Parma Ham chain different firm strategies coexist: those who point at large scale

production just complying with the minimum standards of the PDO product specification and sell

primarily to large retailers, a second group of companies who are specialized in a niche segment of

the Parma Ham chain producing high quality hams for small ‘boutique like” retailers and a third

group of companies who are operating on different market segments of Parma Ham. These features

have their influence on the creation of value added.

In the generic cured ham chain Dutch pig producers deliver their pigs to Dutch

slaughterhouses. The heaviest fresh hams are exported to Italy and the Dutch pig producers may

receive a price premium when a relevant part of their fresh hams are exported for the production of

Italian generic cured ham.

Added value is calculated taking the difference between farm gate, wholesale and retail

prices and non-factor costs at each stage of the pork chain taking into account the valuation of the

pig carcass from producer to consumer.

For each of the three chains added value has been calculated at two phases of the value

chain: at farm level and at the level of the processing company of ham.

The following farm types have been used for the calculation of value added:

1. Dutch pig farms specialized in the production of light pigs (117 kg liveweight). Fresh

hams of these pigs are exported to Italy and are there processed up to generic cured ham.

The calculation refers to the period 2009-2013 and the source used is Interpig (BPEX,

2013). Data refer to a representative sample of Dutch pig farms.

2. Italian pig farms specialized in the production of heavy pigs (166 kg liveweight). The

fresh hams of these pigs are destined to the production of Parma Ham. The calculation


35

refers to the the period 2009 – 2013 and the sources used are the yearly bulletins of CRPA

dedicated to the production costs of heavy pigs in Italy (CRPA, 2013). Data are derived

from a representative sample of Italian pig farms, which are certified for the production of

heavy pigs for the PDO Parma Ham value chain.

3. Three Cinta Senese farms which are either producing live pigs for further processing or

are integrared companies producing processed pork products among which Cinta Senese

ham. The calculation of value added is based on an ‘ad hoc data’ collection in these farms,

which produce PDO certified Cinta Senese pigs.

As the ham companies are concerned two samples of ham companies were composed for Parma

Ham and generic cured ham. The principal feature of these companies is the high degree of

specialization defined as either “prevalent mono production of dry-cured PDO Parma Ham" or “dry

cured generic hams”. Only companies of medium size have been chosen, since large companies in

the sector are unlikely to be "single product". Difficulties would then have been encountered in

processing the balance sheets of companies that produce a wide range of products.

Once the two samples have been constituted the data contained in the balance sheets have

been elaborated for the five year period 2009-2013. The non-factors costs, such as raw materials,

services and other direct processing costs, have been separated from the labour and capital costs and

taxes. As the prices of the fresh hams for Parma Ham are concerned, the price lists of the Chamber

of Commerce have been used in order to extract their value from the total non-factor costs. The

prices of fresh hams for the production of generic cured hams are derived from the export prices of

Dutch fresh hams plus transport costs to Italy. These price lists have been chosen because of the

difficulty to identify the purchase prices from the balance sheets. The added value calculated in this

way refers to the initial weight at the beginning until the end of the seasoning period of the fresh

ham with the bone. In other terms, the value added is expressed per kg of cured ham with the bone.

The two samples were made up of eight companies in the case of Parma Ham, and nine

companies in the case of generic cured ham. From the comparison of the main characteristics of the

two samples interesting differences emerge: the Parma Ham companies process a lower number of

fresh hams than the companies specialised in generic cured ham. The Parma Ham companies on

average season 80-90 thousand hams a year against an average of more than 300,000 hams per year

of the generic cured ham companies.

Table 4.1.Characteristics of the two samples of ham companies

PDO Parma Ham (n=8) Generic cured ham (n=9)

n. hams Sales value € % turnover n. hams Sales value € % turnover

2009 69,000 7,825,000 67 326,000 12,420,000 90

2010 80,000 9,538,000 71 351,000 14,775,000 96

2011 105,000 10,017,000 72 350,000 14,458,000 93

2012 87,000 9,506,000 71 290,000 11,681,000 84

2013 70,000 7,098,000 55 311,000 13,826,000 86


36

A second remark regards the percentage share of ham seasoning on the total turnover of the

company. For the examined Parma Ham companies this percentage share is on average 70% against

90% of the generic cured ham companies. This difference can be attributed to the fact that the

seasoning period of Parma Ham is much longer than that of generic cured ham. The longer

seasoning period implies a longer immobilization of capital which induces the Parma Ham

companies to carry out seasoning services for other Parma Ham companies in order to dispose of

more current liabilities.

The calculation of value added generated in Cinta Senese processing companies is based on

the selection of some enterprises according to a criterium of representativeness. Each firm is

analyzed by means of an in-depth interview and on an accounting analysis. Enterprises were

selected with reference to the two main organizational models:

1. The integrated model: integrated pig farmers which combine the production of live pigs

with the on-farm processing of their meats where slaugherings takes place in small

slaughterhouses which offer these services

2. The long chain model: processing companies which buy live Cinta pigs from the farms,

slaughter them in third companies and process the meats to the final high quality products

of the Cinta Senese These companies are not specialized in Cinta processed products,

which often at the contrary represent a marginal share of their turnover.

A total of four interviews were conducted: 2 downstream integrated pig farmers; one of the

bigger Tuscan ham processor involved in Cinta Senese processing which represent 15% of the total

turnover; one traditional pig farmer.

4.2. Resilience

4.2.1. Description of the attribute “resilience” and research questions

The concept of resilience was developed originally with reference to ecosystems.

Resilience is defined in different ways by different authors, coherently to the different problems

their deal with but also to their different theoretical backgrounds and systems of thinking. In the

context of socio-ecological thinking, resilience has been defined as “the capacity of a system to

absorb disturbance and reorganize while undergoing change so as to still retain essentially the same

function, structure, identity and feedbacks” (Walker et al. 2004, p. 4).

The concept of resilience can be referred to the capacity of a food system to withstand

and/or recover quickly from sudden or acute shocks (such as price fluctuations, disease outbreaks

and other risks factors) in order to be sustainable over the longer term. However, resilience does not

refer only to the capability of a system to absorb external disturbances or to recover from adversity,

but also more in general to the ability to cope with change and to evolve towards new equilibria but

without change its identity. Three main aspects of resilience can be pointed out: persistence, which

refers to the ability to buffer shocks and still maintain function; adaptability, which refers to the

ability to deal with challenges by means of re-organization, change, ability to adjust to a changing

context; and transformability, which implies the capacity to transform the existing system in a

fundamentally new one (Walker et al., 2004; Folke et al., 2010).


37

Learning and capability to innovate, both at individual and at collective/system level, is a

key issue in making systems resilient.

According to Briano et al.(2009), in the business sector resilience refers to the ability of a

company to resist a serious damaging event. Christopher and Peck (2004) define resilience as the

ability of a system to return to its original state or move to a new, more desirable state after being

disturbed, while Fiksel (2003, p. 5333) proposed that resilient systems satisfy four major

characteristics, namely: diversity; efficiency; adaptability; and cohesion. As pointed out by Leat and

Revoredo-Ghia (2013), the notions of flexibility and adaptability are core ones. According to these

authors, “a company or supply chain that has developed its resilience is better able to support the

unpredictability of domestic or international trade, thereby achieving a competitive advantage

through being able to recover more quickly than competitors when an adverse event arises” (Leat

and Revoredo-Ghia, 2013, p. 221).

The analysis of resilience as an attribute of a food chain is complex. Resilience is the

result of many characteristics of a supply chain and of firms operating in it, and depends also on

collective action initiatives firms are able to develop. Resilience is linked to attributes belonging to

the economic sphere, such as profitability and competitiveness, but also to attributes linked to the

resource use and the possible limited availability of key resources in the future. Hence resilience

includes concepts like efficiency, resource use, technological innovation, biodiversity

management, and governance. According to some authors (Soldevila et al, 2009) the organizational

system and governance instruments of the value chain are key premises for building resilient value

chains in pork industry. Other factors impact deeply on resilience, such as public policies – e.g.

market regulations – and consumers behaviours.

In this report a special focus is given to “economic resilience”, according to GLAMUR

National reports, also in order to avoid major overlapping with other attributes. Resilience in fact

can be considered as a key component of the sustainability of a business.

From a methodological point of view, the choice of the unit of analysis is a critical issue. In

fact the interrelationships between the resilience of a food supply chain, and the National food

system from one side, and single firms resilience from the other one, should be carefully analysed.

See in this regard the diagrammatic representation of the risks facing individual businesses and a

supply chain elaborated by Leat and Revoredo-Ghia (2013). As pointed out by the authors, “these

risks are clearly related. For example, the production risks of farmer producers will be part of the

supply risk faced by others further down the chain. Similarly, the market risk faced by the retailer

will ultimately represent the demand risk for the chain as a whole” (Leat and Revoredo-Ghia, 2013,

p. 222). Supply chain risks may ultimately represent systemic risks for the whole food system.

Figure 4.1 Mapping risks facing individual enterprises and the whole supply chain


38

The general aim is to understand how the supply chain participants, and in particular the pig

producers (considered as the more weak and less empowered actors, also due to their exposure to

biological risks), attempt to reduce their own individual and the collective supply chain risks,

thereby making the chain more resilient.

From a methodological point of view, it is clear that in order to analyse resilience it is

needed to start first from an overview of the difficulties affecting the pig sector, and second to

highlight the major risks. Resilience being a dynamic concept, an in-depth analysis asks for a long-

time observation of the behaviour of the system after a specific crisis. The analysis of this attribute

aims to give a general evaluation of the degree of resilience of the three supply chains, the

methodology followed in this work included both quantitative and qualitative tools. The steps of

our analysis are the followings:

- to identify some specific factors affecting the resilience at a local system / supply chain level

(e.g. the degree of market diversification of firms) on the basis of the economic literature

- to find out appropriate indicators that can be calculated for the three food chains and to find

relevant data, according to different available sources

- to identify strategies pursued individually by firms and collectively for improving resilience

in the three supply chains, by means of a case study approach

- to discuss the main results.

The main research questions are:


39

- which are the relevant aspects that should be analysed in order to compare local and global

food chains against resilience?

- are local food chains more resilient than global ones?

- which are the factors explaining different performances of local and global food chains?

- what is the methodological strength and weakness of comparative resilience analysis?

- are there specific interactions of the food chains under study and the policy settings?

4.2.2. Contextualization in the Cured ham supply chain

Relevance of the attribute “resilience” in the cured ham supply chain

As highlighted by EFFP (2009), the pig industry has been in a structural decline, due to a

vicious circle of poor profitability, lack of confidence, underinvestment, falling productivity and

increased production costs. The increase in the volatility of agricultural commodity markets has

exacerbated the cyclicality of the sector, and the economic downturn put pressure on prices of pork-

based final products at a final consumption stage. The upstream and downstream parts of the supply

chain are exposed to different risk and pressures: the upstream part of the supply chain (i.e. farmers

and processors) are more exposed to price movements in feed, whilst downstream actors (i.e.

manufacturers and retailers) are more exposed to changes in consumer demand and to concentration

process at the stage of final distribution.

The pig population in Italy has fallen significantly (between 2010 and 2013 the pig

population in Italy declined by 8.1%) and the processing supply chain has slightly increased imports

of pig meat to meet processors and consumers demand. In recent times many Italian farmers have

protested against low-cost imports of live pigs and fresh hams from Northern and Eastern Europe

countries, asking for new legal rules about the indication of the provenance of the meat on the label.

In this framework, economic resilience became a key issue for the whole Italian pork and

cured ham supply chains. According to GLAMUR WP2 National reports, some relevant

characteristics are identified in order to build resilient food supply chains, like the following:

- limited dependence of farmers (and of firms belonging to other stages of the supply chain)

on a single firm, or on a single geographical market, for their production factors purchases

- diversity of marketing channels and geographical markets for selling their products, both for

farmers and for farmers and firms belonging to other stages of the supply chain

- limited dependency of farmers income and other firm revenues on a single product or

activity

- limited dependency of the supply chain on public sector support

- capability to differentiate their products on the consumer market

- strengthening economic and social connections between actors across the food chain

- a strong level of vertical coordination among firms.

Specific local/global features of the chain affecting the attribute “resilience”

Many sources of information evidence that ham production systems (pigs producers,

slaughterhouses and processors) were facing a complex of significant and related business risks, and


40

in particular (Leat and Revoredo-Ghia, 2013; Protocollo di intesa della filiera suinicola italiana,

2007):

- Production risks: danger of disease outbreaks and a tarnished image arising from disease

concern.

- Market risks: reduction trend in final consumption; strong market competition from imports,

exacerbated by exchange rate movements; escalating feed costs (the major component of

production costs); increasing market power of big supermarket chains; slow and even

possible non-payments.

- Institutional risks: like animal welfare legislation impacting adversely on competitiveness

and potential restrictions on waste disposal. These risks are linked to the perceptions social

actors have about the legitimacy of pig farmers (and other supply chain firms) in doing their

economic activities.

In particular the Generic cured ham supply chain is characterized by a globalized

production model, with an high market (and geographical) concentration in the hands of few big

firms which tend to specialize on specific stages of the chain. The opportunities for product

differentiation are poor and price competition is very strong. In addition, environmental negative

impacts are higher than in more traditional pig breeding systems. The dominant logic in the Generic

ham chain is based on high volumes, low labour intensity and high capital intensity, low added

value per head and per cured ham. In this context searching for scale economies inside the firm and

along the chain is the guiding criterion.

The Parma Ham PDO supply chain can be viewed as a response to the problems of the

generic ham chain. In fact the Product designation of origin allows for an origin-based

differentiation model, and the territorial boundaries fixed in the PDO Product specifications

facilitate a stronger coordination among supply chain actors and support collective actions

initiatives. The dominant logic in the Parma Ham chain is based on the search of high added value

per ham, in order to be able to recover higher costs due to production methods able to valorise the

links between the product and the territory. On the other side, this model can be threatened by the

economic crisis which reduces the purchasing power of consumers.

In the Cinta Senese ham supply chain the integrated model of production is the most

relevant, where a single firm provide both for breeding Cinta pigs and for processing and curing

ham, usually on a small scale and by means of artisanal processing methods. According to QBIC

research project (Regione Toscana, 2011), this integrated model cover roughly 25% of the PDO

Cinta Senese farmers and a lower percentage of the total PDO ham production. From the marketing

side, Cinta Senese supply chain is based on a differentiation model based on two main elements: the

link with the local breed Cinta Senese and the link with a specific territory (including both physical

and human factors, as rearing methods) from which fresh meat and cured hams derive its specific

characteristics. This differentiation model is supported by the legal recognition of a PDO for the

Cinta fresh meat, and its extension to the cured ham by means of a collective trademark managed by

the Cinta Senese Consortium. Both firm integration and origin differentiation are supposed to give

to farmers and processors the opportunity to escape pricing squeeze which characterize ham food

chains. Even if in recent years prices of animals are variable, processed products enjoy good prices

and lots of opportunities for differentiation on the market and channel diversification, thus


41

supporting resilience. In the Cinta Senese ham chain the value creation logic is based on small

volumes, high intensity in labour, high added value per head and per cured ham. Also the links with

local culture is strong (Cinta sense is an identitary product for many Tuscan rural people) and this

support social acceptance of breeding. Searching for scope economies inside the same firm

(between rearing, processing, and other service activities as agritourism) is a guiding criterion for

many firms.

In the light of these differences between the three supply chains, the hypothesis about

resilience is that firms, and in particular farmers, embedded in global chains tends to be more and

more subject to :

- the effects of price volatility, both for inputs and intermediate outputs (pigs carcasses, fresh

hams and other parts), on national and international markets;

- the squeezing by two powerful categories of actors, input suppliers on one side, and final

processors and the retail sector on the other one.

Moreover, firms tends to be strongly specialized in a single product and capital intensive,

thus increasing the exposure to risks.

Local chains seems to be less vulnerable to volatile prices and to risks in general, thanks to

higher levels of diversification and a greater ability to differentiate the product on the basis of

“irreproducible” factors linked to a specific territory. As pointed out by Leat and Revortedo-Ghia

(2013), improved resilience (in terms of reduced supply chain vulnerability to risks) arose also

through horizontal collaboration amongst producers, and vertical collaboration with the processor

and retailer. Their findings, related to a Scottish case-study, highlight that - thanks to a strong

collective action and governance - producers improved market and price stability and pig breeding

performances; for the processor and retailer the collaboration generated greater security of supply of

an assured quality, improved communication with suppliers, and reduced demand risk as they could

assure consumers on quality, animal welfare and product provenance – thanks to a better ability to

communicate with social stakeholders (public bodies, consumers, citizens, environmental

associations …). In principle territorial and cultural contiguity allows for better opportunities of

coordination, lowering transaction costs and easing common vision about different supply chain

actors.

4.2.3. Methodology

General approach and overview of indicators

From a methodological point of view the analysis of resilience of a supply chain asks firstly

to made an overview of the difficulties affecting the supply chain, and secondly to highlight the

major risks it faces. Resilience being a dynamic concept, an in-depth analysis asks for a long-time

observation of the behaviour of the system after a specific crisis.

The scope of this work is to give a comparative evaluation of the degree of resilience of

three supply chains in the cured ham sector. On the basis of a set of specific factors affecting the

resilience at a local system and supply chain level identified in the previous Section thanks to


42

literature analysis, in this Section we identify some indicators able to represent these specific factors

and for which relevant data are available at the needed level of detail.

Given the complexity of the attribute resilience, its analysis was decomposed in various

dimensions for each of which have been developed one or more indicators, divided in 4 categories.

- Volatility indicators provide an overview of the level of price volatility for the different

inputs and outputs of the supply chains

- Analytical indicators measure specific aspects of the chains and are calculated and

presented according to the different stages of the supply chain: pig farming, slaughtering,

and ham processing. The focus on the stages of the chain is justified by the fact that each

sector develops their own strategies for resilience; often these strategies are in conflict with

the other sectors.

- To facilitate the comparison among the three supply chains and the interpretation of data,

some synthetic indicators – built on analytical indicators – have been developed for each of

the three stages of the supply chain.

- Finally, a general evaluation of the degree of resilience of the supply chains as a whole is

given by means of some cross-cutting indicators.

Indicators are both quantitative and qualitative. Qualitative indicators are evaluated by

researchers on the basis of their direct knowledge, of the results of the direct surveys (data and

interviews) and of experts’ advices, using ordinal scales, for example: level 1 (very high, that is

supporting of resilience), level 2 Intermediate, and level 3 (low, that is reducing resilience). The

ordinal scale will be adapted to each indicator. The following table link indicators to research

questions and data collection methods.

Table 4.2. Resilience attribute: indicators, research questions and data collection methods

ATTRIBUTE: RESILIENCE (Economic/Social)

Brief attribute

description (cf.

Comparative Report)

Used indicators Research questions Data collection

methods

Capacity of a food system

to withstand and/or

recover quickly from

sudden or acute shocks

(such as price

fluctuations, disease

outbreaks and other risks

factors) in order to be

sustainable over the

longer term. In this work

the focus is on economic

resilience.

Three categories of

indicators:

- ANAYTICAL

INDICATORS

- SYNTHETIC

INDICATORS

- CROSS-CUTTING

INDICATORS

See the following table

for an analytical

presentation.

which are the relevant

aspects that should be

analysed in order to

compare local and

global food chains

against resilience?

are local food chains

more resilient than

global ones?

which are the factors

explaining different

performances of local

and global food chains?

For all the indicators,

a mix of the following

techniques:

Direct interviews to

supply chain actors

Official data on

prices and other:

ISTAT (national

statistics bureau),

Chambers of

commerce, etc

Previous inquiries

Experts’ advices


43

The following table classify the analytical indicators according to both sectors of the supply

chains and the issues considered, and link them to the synthetic indicators.

Many indicators are linked also to other attributes, and in particular to Added value creation

and distribution, Governance, and Territoriality. These links will be discussed in a specific section

of the general Report.


44

RESILIENCE

INDICATORS

VOLATILITY

INDICATORS

A N A L Y T I C A L I N D I C A T O R S SYNTHETIC

INDICATORS PER

PHASE

Upstream

integration

Downstream

integration

Diversification Differentiation Other

Pig farming

Feed prices index

(V.1)

Live pigs price

index (V.2)

Farmers upstream

integration by

ownership (A.1)

Farmers upstream

integration by

contractual

arrangements (A.2)

Farmers

downstream

integration (A.3)

Farmers product

diversification (A.4)

Farm-level

resistance

against price-

volatility (A.5)

Use of

antibiotics

(A.6)

Farm-level risk-spreading

(S.1)

Adaptation capacity of

farmers through

downstream actors

cooperation, integration

and diversification

strategies (S.2)

Slaughtering

Live pigs price

index (V.2)

Fresh ham price

index (V.3)

Slaughterhouses /

processors upstream

integration (A.7)

Slaughterhouses

downstream

integration (A.8)

Slaughterhouses

product



slaughtering firms



(S.3)

Ham processing

Fresh ham price

index(V.3)

Cured ham price

index (V.4)

Slaughterhouses /

processors upstream

integration (A.7)

…

Processors product


Processors market

diversification for

cured ham (A.11)

Processors

geographical market

diversification for

cured ham (A.12)

Product

differentiation for

cured ham (A.13)


ham processing firms



(S.4)

CROSS-

CUTTING

INDICATORS

Supply chain attitude to diversification and differentiation (C.1)

Intradiversity of chain relations / configurations (C.2)

Chain-based adaptation capacity through learning and innovation (C.3)

Ability to mobilize public and societal support (C.4)


45

4.2.4. Prices volatility indicators

As pointed out by a FAO study (2011), “in a purely descriptive sense volatility refers to

variations in economic variables over time … Here we are explicitly concerned with

variations in agricultural prices over time. Not all price variations are problematic, such as

when prices move along a smooth and well-established trend reflecting market fundamentals

or when they exhibit a typical and well known seasonal pattern. But variations in prices become

problematic when they are large and cannot be anticipated and, as a result, create a level

of uncertainty which increases risks for producers, traders, consumers and governments and

may lead to sub-optimal decisions. Variations in prices that do not reflect market fundamentals are

also problematic as they can lead to incorrect decisions” (FAO et al, 2011). Volatility is

determined by the speed of variation in prices. From a statistical standpoint, the greater the

magnitude of its rate of change (up or down), the greater the speed of such change and the more

changes there are in opposite directions, the more volatile a price will be.

Along pork chains the volatility can be measured at four stages:

- Volatility of feed prices (concentrate and other)

- Volatility of live pig prices

- Volatility of fresh ham prices

- Volatility of cured ham prices

The concentrate/feed price on the national/international market is not really under the

control of the pig farming system, instead it should be considered mainly as a “factor risk” able to

menace the supply chain resilience. Taking in account the relevance of costs of feed for pig farmers,

their upstream integration initiatives can be interpreted as a way to cope with the feed prices

volatility (see the following Indicators, in particular the indicator b).

The degree of volatility of live pig, fresh ham and cured ham can be hardly impacted by the

capability of the system (the supply chain) to manage prices.

In this study, volatility is measured by the coefficient of variation, given by the ratio of

mean and standard deviation of the current values of prices (Visciaveo and Rosa, 2012). In this way

it is possible to obtain a dimensionless index that allows comparison between different series.

4.2.5. Pig farm indicators

Analytical indicators

A.1 and A.2 - Farmers upstream integration

Concerning pig farming , the volatility of concentrate price, and in general of pig feed, is

one of the main risk factors menacing the supply chain resilience. This is true mainly for intensive

pig farming where net operating income per unit is very low and progressively eroded by the

growing monopsony power of large buyers and distributors. Integration, in different forms, allows

for lessen or eliminate the effects of volatility in feed prices. The direct upstream integration in feed

production by farmers (ownership integration) allows them for a stronger control on feed supply.

The efficiency of a pig farmer in feed production can be much lower than a specialized firm, and


46

often structural conditions can impede feed production. This indicator is calculated as the share of

pig farmers which self-produce the majority of feed over the total number of pig farmers, for each

one of the three chains. Other indirect forms of integration, like contractual arrangements between

feed producers (farmers or specialized firms) and farmers, can be very relevant in order to stabilize

feed prices: another possible indicator is the presence and extent of mid or long-term contractual

arrangements (like interprofessional agreements). Indicators are collected by means of expert

consultation, except from Cinta Senese where a sample of firms was interviewed.

A.3 - Farmers downstream integration

The volatility of live pigs price affects farmers’ resilience. Downstream integration, in

different forms, allows for the reduction of volatility in pigs prices. The direct downstream

integration in processing by farmers (ownership integration) allows them for the stronger control.

Technical efficiency of a pig farmer in processing is normally much lower than a specialized firm,

and this imply economic inefficiency if not supported by appropriate marketing strategies. Farmers

integration can be pursued also by means of co-operative firms operating in slaughtering and/or in

processing. Other indirect forms of farmers downstream integration, like contractual arrangements

between pig farmers and downstream activities can be very relevant in order to stabilize live pigs

prices. Hence another possible indicator is the presence and extent of mid or long-term contractual

arrangements (like interprofessional agreements).

A.4 - Farmers product diversification

The production portfolio of a firm should be balanced along the trade-off between high

specialization with related scale economies on one side, and high diversification. Product

diversification allows for a diversification of risks but entails higher production costs, even if lower

economies of scale may be offset by greater economies of scope. This indicator is calculated as the

share of (light/ heavy/Cinta) pigs for ham production on the total turnover of farm. The hypothesis

is that the lower is this value and the higher the degree of diversification, the higher is the capability

of the firm to be resilient against shocks on the market. Two different typologies of product

diversification occur: the first one is a diversification linked to pork farming (like waste-flow

valorization, but also meat processing is a way of diversification), the other one is outside the pork

chain both on-farm (like developing agritourism activity on farm) and off-farm.

A.5 - Farm-level resistance against price-volatility

The resistance at farm level against price volatility of the input and output markets of

relevance for pork production can be expressed in a synthetic way by considering its economic final

result, that can be appreciated by means of added value. A proxy of the exposure of farmers to input

and output volatility is the delta of the added value per kg live weight calculated at farm level for

each year from 2009 to 2013. The higher this delta, the lower the ability of farmers to stabilize

prices and/or to transfer input prices increases in output prices increases.

A.6 - Use of antibiotics

A completely different indicator for resilience is the use of antibiotics in pig farming.

Intensive pig rearing systems are subject to epidemics and diseases, due to the high concentration of

animals in small spaces. For this reason antibiotics are administered also in order to prevent and not


47

only for treat diseases. Therefore high levels of use of antibiotics are indicative of high exposure to

disease risks, and on the other side can generate negative effects on the meat quality and on human

health.

Synthetic indicators

In this section are presented some synthetic indicators per each of the three main stages of

the cured ham supply chains. Synthetic indicators are built on analytical indicators presented in the

previous section, integrated by other qualitative information and expert advice.

S.1 - Farm-level risk-spreading

Upstream coordination with feed production, farm diversification and product

diversification are key issues for farmers in order to escape the logic of mass market and be more

resilient. The indicator “farm-level risk-spreading” synthetizes three of the aforementioned

indicators, that is: Farmers upstream integration by ownership; Farmers upstream integration by

contractual arrangements ; and Farmers product diversification.

S.2 - Adaptation capacity of farmers through downstream actors cooperation, integration

and diversification strategies

This synthetic indicator take in account the strength of farmers interlinkages with

downstream actors diversification strategies in terms of productfolio and marketing, that can be

obtained thanks to coordination and adaptation to downstream actors or by means of direct vertical

integration in processing activities. Downstream integration in ham meat processing (ham and other

cold cuts) allows farmers for a better control on live pigs prices, escaping from monopsonistic

power of downstream actors, and give access to higher added value activities by valorizing specific

qualities of their pigs. This synthetic indicator is evaluated taking in account two analytical

indicators, farmers product diversification and farmers downstream integration, and other

qualitative evaluations based on empirical evidences and literature review. This indicator is

evaluated by means of an ordinal scale, that is: level 1 (high adaptation capacity: in favor of

resilience), level 2 (intermediate), and level 3 (very low adaptation capacity).

4.2.6. Slaughtering indicators


A.7 - Slaughterhouses/processors upstream integration

Slaughterhouses and processors through upstream vertical integration aims at control and

coordinate quantities, quality and prices of live pigs and/or fresh hams, in order to be able to better

meet intermediate and final demand needs.

A.8 - Slaughterhouses downstream integration

Similar problems are fronted by slaughterhouses with regard to fresh hams prices. Also in

this case downstream integration can be pursued by different tools, mainly by ownership and by

contractual arrangements.


48

A.9 - Slaughterhouses product diversification





share of pigs slaughtered for production of generic / Parma PDO / Cinta Senese ham on the total

turnover of slaughtering firms. The hypothesis is that the lower is this value and higher the degree

of diversification, the higher is the capability of the slaughtering firm to be resilient against shocks.


S.3 - Adaptation capacity of slaughtering firms through integration and diversification

strategies

Slaughterhouses are economically highly vulnerable as they operate in between two highly

volatile markets. This synthetic indicator takes into account the capacity of firms to adapt to the

evolution of market conditions by means of better integration with upstream and downstream

actors, and of the development of diversification strategies aimed at risk differentiation. The

indicator is evaluated taking in account some analytical indicators (volatility indexes,

slaughterhouses upstream and downstream integration, and slaughterhouses product diversification)

and other qualitative evaluations based on empirical evidences and literature review. This indicator

is evaluated by means of an ordinal scale, that is: level 1 (high adaptation capacity: in favor of

resilience), level 2 (intermediate), and level 3 (very low adaptation capacity).

4.2.7. Ham processing indicators



The same indicator than for slaughtering.

A.10 - Processors product diversification





share of processing firms with a share of generic / Parma PDO / Cinta Senese ham higher than 70%

on the total turnover of processing firms, on the total number of firms. The hypothesis is that the

lower is this value and hence the higher the degree of product diversification, the higher will be the

capability of the processing firm to be resilient against shocks on the market of cured ham.

A.11 – Processors marketing channels diversification


49

In front of the increasing market power of large retail companies, the capability of cured

ham sellers to operate in different marketing channels and in different geographical markets is an

important factor of resilience. Being impossible to analyze the dependence from single purchasers,

the indicator of market diversification of cured ham sellers is calculated as the ratio between the

number of processing firms with a share of turnover from (generic/Parma/Cinta) ham higher than

66% in one marketing channel and the total number of the processing firms in the supply chain. For

generic ham and Parma Ham we considered four main types of marketing channels: Supermarkets

groups (GDO), Traditional retailers, Wholesalers, and Other.

A.12 – Processors geographical markets diversification

Geographical market diversification is an other relevant element able to increase resilience,

because it allows for a diversification of market risks. Market risks depend not only from consumer

demand, but also from sanitary reasons and other trade barriers.

A.13 – Processors product differentiation

The capability to differentiate the product on the final market in order to increase loyalty of

final consumers to own product is very relevant for cured ham producers in order to stabilize trade.

Reputed individual trademarks and collective marks, like designations of origin, play a relevant

role. In particular Designations of origin allow also to small producers access differentiation

strategies. The reputation of Designations of origin is based also on traceability and control systems,

that guarantee consumers about the compliance with product specifications and in particular about

the provenance of raw material.


S.4 - Adaptation capacity of ham processing firms through integration and diversification

strategies

Ham processing firms play a key role in the three chains, they links pig farming and

slaughtering phases to the phase of distribution and to final consumption. This synthetic indicator

take in account the capacity of firms to adapt their supply to final demand but also to influence its

evolution, by means of better integration with upstream actors, diversification strategies and product

differentiation that are more and more relevant in order to contrast the increasing market power of

large retail companies. At the same time the capacity to orient, control and guarantee the even more

complex quality characteristics of fresh hams (both material and immaterial ones, like

environmental sustainability) is often a prerequisite for developing appropriate marketing strategies

on cured hams. The indicator is evaluated taking in account some analytical indicators (volatility

indexes, ham processing firms upstream integration, product diversification, market diversification

and product differentiation) and other qualitative evaluations based on empirical evidences and

literature review. This indicator is evaluated by means of an ordinal scale, that is: level 1 (high

adaptation capacity: in favor of resilience), level 2 (intermediate), and level 3 (very low adaptation

capacity).

Cross-cutting indicators


50

C.1 - Supply chain attitude to diversification and differentiation

The overall level of the supply chain attitude to diversification and differentiation can be

evaluated by means of analytical indicators related to product differentiation in all the phases of the

supply chains, marketing channels and geographical market diversification for cured ham, and

product differentiation for cured ham. On the basis of these basic data expert can express an

evaluation on an ordinal scale.

C.2 - Intradiversity of chain relations / configurations

This indicator is based on the idea that an internal diversity of organizational and business

models and strategies can improve the resilience of the supply chain, allowing for a a diversification

of risks. Indeed specific crisis factors may prejudice some models of chain organization, but not

others. The evaluation of this indicator is based on expert consultation and on other information

collected during the survey.

C.3 - Chain-based adaptation capacity through learning and innovation

As pointed out in the introduction, the concept of resilience does not refer only to capability

of a system to absorb external disturbances but more in general to be able to cope with change and

to evolve towards new equilibria. In this perspective learning and capability to innovate, both at

individual and at collective/system level, is a key issue in making a supply chain resilient. The

evaluation of this indicator is based on expert consultation and on other information collected

during the survey.

C.4 - Ability to mobilize public and societal support

The ability to mobilize different types of public and societal support is a key feature of

resilient supply chains, in particular in time of rapid changes. Public support can take many

different ways, from national, regional and local public authorities: support to investments in the

field of rural development plans, technical assistance, public investment in research and genetic

improvement, support to develop systems to guarantee the origin and quality of products, and many

others. Even the societal support is very important as it gives social legitimacy to pig farmers and to

their activity them; social support constitutes an important prerequisite for the activation of public

policy support. The indicator is calculated by means of an ordinal scale, by analyzing the presence

of political and social support activities of various types and level (national, regional and local).

4.3. Chain governance

4.3.1. Description of the attribute

Governance covers a wide range of meanings (cfr. WP2 Deliverable), from concepts related

to the regulatory system (how food systems are regulated and decisions made), to more holistic

concepts of power and democracy (who has influence over food systems and policy).

Chain governance is a relevant attribute for both local and global chains where the PDO

producers are represented by a collective body (Parma Ham PDO Consortium). The action of this

collective organization distinguishes these regulated chains from the non-PDO generic ham chain, a

supply chain without formal governance, while benefiting from the reputation of the geographical


51

indication Parma Ham. The functions of control and supervision were clearly separated, with

control to be carried out by a third party and the Consortia to supervise operations once the

certification body had laid down standards. On this basis, the PDO Consortium supported the

setting up of the certification body, the Istituto Parma Qualità (IPQ), which checks documentation

of inspections and tests carried out at all farms, slaughterhouses and producer firms. The

Consortium itself is active in supervising sales and has no hesitation in taking legal action against

counterfeiting and abuse. It is this complex system of supervision and governance of the network

which has helped to give the PDO product its widespread recognition for soundness

The PDO Parma Ham Consortium in 2004 has amended its statutes to ensure a more

balanced representation of the supply chain, as laid down by Law No. 526/99. The new statutes take

different roles into account; Article 1.1 allows for farmers, slaughterers, cutters and packers to join

the consortium and contribute to its budget as well as the processors themselves (Consortium

statutes give 66% of votes to producers, and the remaining 34% are divided among other supply

chain members, farmers, slaughterhouses, cutters and packers). The requirements for producers

have also been relaxed: it is no longer necessary for at least 75% of ham output to be Parma Ham.

PDO Parma Ham production is based on Consortium specification codes for each phase of

production, which are approved at EU level. The definition of these rules by the Consortium

members has built up an indissoluble link between product and district, with direct effects on

employment and income (Giacomini et al., 2013a).

The PDO Parma Ham Consortium is the central node of the network. Law No. 526/99 lays

down its functions as tutelage, enhancement and consumer information (Figure 4.2). In governance

it holds regular meetings where members are informed of strategy. The link is in two directions as

members elect the Board of Administration and other panels and thereby influence policy. The

Board is composed by 15 producers, 1 pig breeder, 1 slaughter house and 1 packager. All firms are

today eligible to vote regardless of the proportion of Parma Ham that they produce. This means that

big producers can influence the Board decisions more than small producers and this can affect the

Consortium strategies, especially those related to quality definition. The Consortium therefore

represents the interests of two types of producer of conflicting vocation and company strategy. On

one hand, there are the small producers, often producing exclusively Parma Ham PDO, and on the

other hand large and even multinational manufacturers for whom Parma Ham is simply a product to

place on the market. Consortium decisions are inevitably a compromise between these two

conflicting poles. Dentoni et al. (2012) also confirm that Parma Ham Consortium members have

highly and increasingly heterogeneous characteristics, assets and strategies and that higher

heterogeneity negatively affects members’ agreement on the future level of restrictiveness of Parma

Ham PDO as geographical indication and therefore the effectiveness of the collective action.


52

Figure 4.2 – Governance and accreditation relationships in the PDO Parma Ham network.

Source: Giacomini et al. (2013a).

For the generic non-PDO cured ham network (Figure 4.3) trade in resources is closely linked

to the Parma Ham PDO network, partly because some of the players are the same and partly

because generic cured ham takes advantage of the geographic and reputational spillover from the

PDO version (Giacomini et al., 2013a). Generic cured ham manufacturers also benefit from synergy

in the Parma Ham district, the widespread availability of information and know-how in production

techniques built up over decades, as well as parallel services supplied by firms in the Localized

Agri-Food System. It is mainly larger firms, often producing both types of ham, which benefit from

this geographical spillover. This overlapping creates a competitive advantage for those producers

trying to exploit economies of scale, instead of providing quality benefits. At the same time, small

producers attempting to create value and gain a competitive advantage through providing superior

product quality could be placed out when market prices are decreasing. The role of the Parma Ham

Consortium in the generic non-PDO cured ham network can be seen from two angles. On one hand,

the informational and enhancement carried out by the Consortium indirectly affects the generic ham

network as geographic and reputation spillover. On the other hand, Consortium policy is influenced

by its mixed membership (Dentoni et al., 2012).

Overseas

Wholesalers

Retailers

Italian suppliers of raw material (fresh hams)

Parma Ham PDO Consortium

Istituto Parma Qualità (I.P.Q.)

Italian farms – certified pigs

One way link

Two ways link

a

a

a b

d

c c

c e

Generic cured ham producers

Parma Ham PDO

producers

d


53

Figure 4.3- Trade in resource in the generic non-PDO cured ham network

Source: Giacomini et al. (2013a).

Summarizing in the same Localized Agri-food System of the Parma province, two different

networks operate where agents, cooperating and competing at the same time, encourages the spread

of technological and market know-how and the generation of positive geographical and reputational

spillover. These latter generate the development of networks among firms, directly by way of

alliances, or indirectly through intermediaries. The comparison of the two networks shows the

relationships between operators acting inside and outside the district and particularly relationships

with institutions of governance affecting firm behaviour and markets.

Chain Governance of local supply chain of Cinta Senese relies on the action of the PDO

Consortium which represents local farmers and processors. The main body involved in the

governance of Cinta Senese PDO system is the Consorzio di Tutela della Cinta Senese, constituted

in 2000 with the support of the province of Siena. The membership base of the consortium is

composed by different groups of interest. Traditional farmers producing small quantities (40-60

pigs/year) of high quality Cinta Senese pigs in large extensions of land with forest;

entrepreneurs/farmers involved more recently in the chain and producing larger quantities of pigs

(100-800 pigs/year) and/or processing them into charcuterie products on farm; pork processors

certifying a minor part of their production under the PDO scheme. Decisions are supported also by

advice and information from representatives of the local government as regards for example the

formal process of acknowledgement of the PDO scheme and relationships with the Ministry of

Agriculture. The board of directors consists of representatives of farmers (5 members),

slaughterhouses (1 member) , sausage and slicing firms (3 members).

Overseas

Wholesalers

Retailers

Generic non-PDO

ham producers

Italian suppliers of raw material (fresh

hams)

Foreign suppliers of raw material (fresh

hams)

Italian farms – certified PDO pigs

Services suppliers

Intangible flow

Tangible flow

One way link

Two ways link

Mixed producers

Parma Ham PDO

producers

b

b

c

a

d

d


54

Indicators used to monitor the chain governance attribute are mainly qualitative in nature and based

on literature review. The aim is to describe the specificity of chain management regarding the

capacity to manage internal and external relations and thus to adopt appropriate and effective

management actions. Indicators used to monitor the chain governance attribute are:

i) trust based internal relationships: this indicator represents the level of trust-based

relations between chain actors, based on (1) absence of conflicts, (2) trust among chain

partners, and (3) continuity of chain relations. It is measured on an ordinal scale: value 1

(maximum level of trust), value 2 (intermediate level), value 3 (low level of trust);

ii) trust based external relationships: it indicates the level of trust-based external

relationships based on chain partners' capacity to mobilise support from (1) social

movements, (2) citizens and (3) policy actors. It is evaluated by means of an ordinal

scale with value 1 (maximum level of trust), value 2 (intermediate level), value 3 (low

level of trust);

iii) self governance capacity: this indicator represents the level of self-governance capacity

in terms of creation of distinctiveness. It is measured on an ordinal scale: value 1

(maximum level of distinctiveness), value 2 (intermediate level), value 3 (low level of

distinctiveness);

iv) chain-based value governance: this indicator represents an overall value governance

characteristics conform the typology of Gereffi et al. (2005), that is market, modular

value chains, relational value chains, captive value chains, and hierachy.

4.4. Territoriality


The identity of several food products reflects the unique combination of local natural

resources (climate, soils, local breeds and plant varieties, traditional equipments, etc.) and cultural

ones (traditions, know-how and skills, some of which are transmitted through generations) in a

given territory, linking the product, the people and the place (Vandecandelaere et al., 2009).

Therefore, territory plays a relevant role in the production process considering the economic,

environmental and social aspects that characterize the area of productions. The attribute

territoriality can be considered the result of the interplay between characteristics and strategies of

local producers in their business activity, social relationship among producers and employees, and

environmental resources. The combination among these three dimensions (production, social

relationships and environmental resources) characterizes every single production system and the

related territory that support this activity.

Territoriality encompasses the capability of a supply chain to represent and promote the

localness of a product and its link with a specific terroir or place of production (GLAMUR WP2

definition). Sonnino (2007: 63) defined territoriality as “the ecological and cultural relationships

that a food system has with its territorial context”. The scientific debate around the role of the

territory in terms of contributing to the value creation process clearly underline the social aspects in

that it involves the protection of jobs, culture, traditions and indeed whole communities (Bowen and


55

Zapata, 2009). Sociologists have used the concept of embeddedness to examine the relationships

between social networks, social capital, cultural and cognitive elements and the construction of

markets and production systems within a particular territory (Bowen, 2010, 2011). Much has also

been written within the scientific literature about the importance of developing food chains

associated with specific territories that can help to maintain and promote non-standardized food

products on new and existing markets, to preserve the associated socio-ecological system, to

valorise traditional and artisanal food production, and to maintain population activities in rural

areas. In this perspective, they can contribute from the production side to a territorial and integrative

approach for sustainable development in particular in fragile areas (Vandecandelaere et al., 2009).

The two main discourses in relation to territoriality include the protection of cultural

identity, traditions, territory and so on for their own sake, but also the ability of territorially-linked

produce to be able to add value and access markets as a result of increased distinctiveness. In this

context, the production of “local” commodities is nested in wider regional, national, and

international networks (Hinrichs, 2003). The other main discourse concerns the authenticity of the

message that is being communicated to consumers about the underlying 'territoriality' of the

produce they are buying. The resources of the region (landscape, cultural and historical resources

and local savoir faire) become embedded in the food product, thereby synthesizing the territorial

attributes in the product name (i.e. the geographical indication – GI).

In the specific case of cured ham production, territoriality becomes relevant to describe the

characteristics of the production system, the linkage with the local inputs and the level of

embeddedness of the supply chain in the territory. Information regarding the characteristic of the

production system allows to depict how and why the territory performs and manages its economic

and social growth and the management of specific governance actions. Similarly, within the

territory, other private sector actors, outside the production supply chain, can establish very useful

and successful alliances with GI systems, in particular tourism activities as a result of synergies

related to the territory reputation (Vandecandelaere et al., 2009). Finally, the product specification

linked to a specific product may provide rules for applying the quality to the GI producers located

in a delimited area. It defines the specific characteristics of the food product which are attributable

to its geographical origin, justifying the link between the product and the territory (the same product

cannot be elaborated in other territories). It must explain how a given quality (the specific attributes

that make the product different of the other of the same category), a reputation (history of the

product, past reputation, current reputation) or another characteristic (for instance know-how) are

linked to the origin (Vandecandelaere et al., 2009).

Therefore, the key elements defined within the territory affecting the supply chains are:

the structural characteristics of the territorially embedded agricultural units and food

industries;

the link of the product with the local input (as defined by the product specification);

the promotion activities by collective bodies and institutions (e.g., PDO Consortia);

the marketing strategies developed on the territory, as a result of the cooperation between

farms, food industries, PDO Consortia and other territorial actors (e.g., Gourmet Food and

Wine Routes).


56

The successful management of these specific elements can improve the competitiveness of the food

system and, as a consequence, the improvement of the whole territory.

4.4.2. Indicators

Seven main indicators, belonging to the three main areas Association of product with

territory, Social cohesion and conviviality, and Links with local touristic activities, were measured

to depict the territorial dimension of the local, regional and global chains analyzed. The idea is that

those indicators can be considered as proxy of the specific characteristics of territorial attribute

(Table 1).

Table 4.3: Attribute Territoriality (Social dimension)

Indicator Measurement Unit Data Source


with territory - Pig

breeding importance

Pig farms on total farms with

livestock in the territory (%)

Percentage IPQ/INEQ, ISTAT


with territory - Pig meat

processing importance

Pig meat processing industries

on total food industry in the

territory (%)

Percentage IPQ/INEQ, ISTAT,

UNIPR


with territory - Origin of

raw materials

Is there a link between the

origin of raw materials (e.g.

fresh meat, feed) and the

territory?

Ordinal scale: level 1 (strong

link with the territory), level 2

(intermediate link with the

territory), and level 3 (weak link

with the territory)

UNIPR, UNIFI

Social cohesion and

conviviality - Number of

events

Number of socio-cultural

events in the territory

Pure number Interviews, secondary

data (Parma Ham

Consortium, UNIFI)

Social cohesion and

conviviality - Number of

visitors

Number of visitors in socio-

cultural events in the territory

Pure number Interviews, secondary

data (Parma Ham

Consortium, UNIPR)


activities - Gourmet

Food and Wine Route

Is there a Gourmet Food and

Wine Route involved?

Binary scale: 1 = yes, 0 = no Interviews, secondary

data (UNIPR, UNIFI)


activities - On-farm

touristic activities

% of farms involved in on-

farm touristic activities (agri-

tourism, food tasting, etc.)

Ordinal scale: level 1 (more

than 40%), level 2 (from 10% -

40%), level 3 (less than 10%)

Interviews, secondary

data (UNIPR, UNIFI)

The dimension “Association of the product with territory” has been assessed by three

indicators, considering both the rural and the industrial dimensions. First we assessed the number of

pig farms involved in the supply chain as a percentage of total farms with livestock in the territory.

The indicator shows the relative importance of pig breeding on total livestock breeding in the

territory. These data were gathered by province (NUTS 3 level) from the Italian Census data of

Agriculture (ISTAT, 2010) and from the third certification body of the PDO chains (INEQ for Cinta

Senese PDO, and IPQ for Parma Ham PDO). The second indicator considered the number of pig

meat processing industries involved in the supply chain as a percentage of total food industry in the

territory. The indicator shows the relative importance of pig processing industries involved in the


57

supply chain on total food industry. These data were gathered by province (NUTS 3 level) from the

Italian Census data of Industry and Services (ISTAT, 2011) and from the third certification body of

the PDO chains (INEQ for Cinta Senese PDO, and IPQ for Parma Ham PDO). Finally, we

considered whether there is a link between the origin of raw material (e.g., fresh meat, feed) and the

territory. This indicator is measured on an ordinal scale based on qualitative evaluations considering

the specific chain's features and the product specification eventually applied, with level 1 indicating

a strong link with the territory, level 2 an intermediate link and level 3 a weak link of raw materials

with the territory.

The dimension “Social cohesion and conviviality” was assessed by two indicators used to

identify the socio-cultural relations and externalities linked with food chains, contributing to create

social cohesion within the territory. First we considered the number and type of socio-cultural

events favoured by the chain in the territory; secondly, we assessed the number of visitors in these

socio-cultural events on the territory. These two indicators are based on information provided by

Consortia and other local sources (e.g., direct interviews with stakeholders).

Finally, two indicators were used to assess the chain “Links with local touristic activities”. In

this case, we first qualitatively considered whether there is a Gourmet Food and Wine Route

involved in the territory related with the food supply chain. This is basically a binary qualitative

indicator. Secondly, we have assessed the percentage of farms within the territory involved in on-

farm touristic activities, such as agri-tourism, food tasting, etc. These two indicators are based on

information provided by Consortia and personal interviews with key stakeholders.

4.5. Resource use and pollution


Resource use concerns the use and management of the flows of available resources in the

global and local food chains. Pollution encompasses any input into the natural environment which

causes adverse changes to ecosystems.

Global chains are presumed to pollute more and to use more resources compared to local

chains because of the long distance transport of the raw materials and the end products. This

common assumption generates the high interest of conscious consumers to purchase more local

food than global food. It is however relevant to measure the different environmental impacts of

global and local chains, as the nature of the production systems plays an important role in the final

environmental assessment.

The nature of the production system affects resource use and pollution significantly and

much more than transport of raw materials and of end products. Several studies have demonstrated

that transport only plays only a minor role in the overall environmental impact of food chains. A

local food system based on highly intensive production systems may perform worse than a global

food system in which an extensive use of resources predominates. Of course the total impact has to

be broken down in the different impact categories such as carbon footprint, water footprint,


58

eutrophication and land use and the final judgment will depend on which impact category will be

chosen.

The metodology of Life Cycle Assessment (LCA) has been developed according to to the

ISO 14040 and 14044[standards. LCA is a method to evaluate the environmental impact during the

entire life cycle of a product. Generally, two types of LCA methods are used: attributional and

consequential LCA.

In attributional modelling upstream emissions and resource extraction are allocated

wherever multi-product processes occur. In consequential modeling the emissions amd resource

extraction of marginal products that could substitute the co-products are subtracted from the product

life cyle.

In this study we have chosen attributional modeling since most of the inputs are directly

attributed to the production. We have studied all the impacts generated throughout the various

phases of production of the ham, from the breeding phase to the phase of slaughtering, seasoning

down to retail.

LCA joints the environmental impact to a unit function, which is the main reference of a

production system. We have calculate all impacts per kg of cured ham at retail level. In different

phases of production we have considered the kg of live weight (breeding), kg of carcass

(slaughterhouse), kg of ham (seasoning) and at the end kg of slice ham (retail).

One important aspect is related to the allocation issue in the case of supply chains that they

have more than one type of product. In these situations, the environmental impact of the production

system must be allocated to different outputs. Three main allocation methods exist (ISO, 2006):

economic allocation, physical allocation and system expansion.

We have adopted a physical allocation in function of the mass of the various output products

from the processing steps. The impacts are based on the weight of the various products that

gradually came out of the production cycle. Breeding: we have considered the live weight, selecting

only the inputs necessary for the production of pig and ignoring all the inputs for other productions.

Slaughterhouse: we have attributed all the impact at carcass mass (80% of live pig weight).

Seasoning: we have attributed the impacts considering the fresh ham mass as carcass part (cured

ham yield 70%), for retail we attributed the impact as part of ham really sold (slice yield 55% of

cured ham).

4.5.2. Indicators

In this study the following environmental impacts (indicators) have been calculated with the

program SimaPro 8.0.3.

1. Climate change, carbon foot print (CO2 eq/UF)

Climate change describes changes in the global, average surface-air temperature and

subsequent change of various climate parameters. This effects things such as storm frequency and

intensity, rainfall intensity and frequency of flooding. Climate change is caused by the greenhouse

effect which is induced by emission of greenhouse gases into the air (CO2, CH4, N2O). Factors are

expressed as Global Warming Potential for time horizon 100 years (GWP100), in kg CO2-eq.

(IPCC 2007 method developed by the International Panel on Climate Change)

http://en.wikipedia.org/wiki/Life-cycle_assessment#cite_note-8


59

2. Land use (m2/year/UF)

Land use is related to use (occupation) and conversion (transformation) of land area by

product related activities such as agriculture, roads, housing, mining etc. Land occupation considers

the effects of the land use, the amount of area involved and the duration of its occupation. The

amount of either agricultural land or urban land occupied for a certain time are expressed as

m2*year (ReCiPe midpoint method: agricultural land occupation impact category)

3. Cumulative energy demand (MJ/UF)

Cumulative energy demand aims to investigate the energy use throughout the life cycle. It

describes the total amount of energy that is needed for the product. The method to calculate

Cumulative Energy Demand (CED) is based on the method published by Ecoinvent version 1.01

and expanded by PRé for energy resources available in the SimaPro database. Characterization

factors are given for the energy resources divided in 5 impact categories: among these we have

considered: non renewable fossil energy calculate in MJ/UF.

4. Water resource depletion (m3/UF)

Water resource depletion is caused by the consumption of water resources, which lowers

their availability for nature and future generations. The method used is based on the publication

Hoekstra et al (2012) (Water Scarcity) This water scarcity indicator (WSI) is based on a

consumption-to-availability ratio (CTA) calculated as the fraction between consumed (referred to as

blue water footprint) and available water. The indicator is applied to the consumed water volume

and only assesses consumptive water use.

5. Eutrophication (kg PO4-eq/UF)

Eutrophication (also known as nutrification) includes all impacts due to excessive levels of

macro-nutrients in the environment caused by emissions of nutrients to air, water and soil.

Nutrification potential (NP) is based on the stoichiometric procedure of Heijungs (1992), and

expressed as kg PO4/UF. calculate by EPD 2013 method. This method is the successor of EPD

(2008) and is to be used for the creation of Environmental Product Declarations (EPDs), as

published on the website of the Swedish Environmental Management Council (SEMC). An EPD is

always created according to a Product Category Rule. Eutrophication impact categories are taken

directly from the CML-IA baseline method.

4.6. Affordability


Affordability is essentially a consumer-oriented perspective attribute, and has to do with

“accessibility to food by middle and lower income consumers” (cfr. GLAMUR WP2 Deliverable).

Affordability applies to individuals / households but also to communities and groups (usually those

with middle and low income). It is an increasing feature of public debate and relates directly to food

security. It is referred to in terms of “the cost of food to the consumer” or described as “the price

level that the product has for the final consumer”, related to various conditions and factors that


60

influence the value chain “from farm to fork”, and is often connected to the issue of income

distribution along the chain and among citizens.

The Italian WP2 Deliverable asserts that price competitiveness of the supply chain

influences the price of food to the final consumer. The WP2 Deliverable shows that local food

products are often perceived as more expensive (e.g., Latvia, the UK, Belgium, Senegal) than those

provided through global supply chains. The main discussion is about the ability of global food

chains to cut costs by, for instance, outsourcing and hence offering affordable prices to consumers.

Some reports argue that large scale production and distribution chains are more able to cope with

economic risks/shocks, which allows global food chains to offer lower and more stable prices.

Global food chains are thus perceived as more efficient and better at cutting down costs in order to

provide affordable prices to consumers. However, the issue of economic and environmental trade-

offs is often recalled; for instance, the case of pork meat carries several criticisms about the lack of

‘real cost pricing’ methods that more adequately succeed to include its negative externalities in

terms of environmental problems, overconsumption threats, food related health problems, etc.

In the case of Italian cured ham, affordability attribute is relevant since the local, regional

and global supply chains have completely different level of price on the marketplace, serving

different market segments and consumers. Affordability, interpreted as the price level that the

product has for the final consumer, is affected by the following items:

production methods and costs; the global chain (generic ham) is characterized by

foreign meat (cheaper meat, mostly because of the lower age and weight of the pigs),

industrial production methods (chemical elements used in the processing phase) with

exploitation economies of scale, absence of certification costs (control, monitoring,

documentation), etc. The regional chain (Parma Ham PDO) is also characterized by huge

production and economies of scales exploitation, but with higher costs from certification

and traceability guarantee system, including supply with meat from heavier pigs

slaughtered in certified plants and bred in controlled farms. The local chain (Cinta

Senese PDO) is characterized by small production, local feed usage, traditional breed

preservation and breeding methods (extensive livestock grazing), stronger linkage and

integration with downstream sectors (e.g., slaughterhouses and cutting plants, agri-

tourisms and short channels, etc.).

consumers’ perception of quality, preferences and willingness to pay (WTP); market

evidence and choice experiment studies show different consumers' quality perception,

preferences and willingness to pay for Parma Ham PDO compared to generic cured ham

(Capelli et al., 2014). At the moment, there are few official retail data on prices and no

experimental studies about consumers WTP for Cinta Senese PDO hams.

4.6.2. Indicators

Three indicators were used to assess “Affordability” attribute, considering quantity

consumed, retail price trends and consumers preferences and WTP (Table 1).

The first concerns the consumption of pork meat. This indicator was measured collecting

data about per capita and total pork meat consumption in Italy (ISTAT and Eurostat data) and


61

quantity consumed on domestic market of the three considered products. Parma Ham PDO and

generic non-PDO cured hams data on consumption are derived from Nielsen and Qualivita data.

Cinta Senese PDO data are provided by the Consortium of Cinta Senese.

The second indicator considers average retail prices (€/kg) on domestic market for the three

products. Parma Ham and generic non-PDO cured hams prices have been provided by the Parma

Ham PDO Consortium (Nielsen data) using time series for the period 2007-2013. The Cinta Senese

PDO prices have been provided by interviews with key stakeholders and direct survey in retail

outlets.

The third indicator takes into consideration the consumers’ quality perception of hams

measured on an ordinal scale with value 1 (high quality perception), value 2 (intermediate quality

perception), and value 3 (low quality perception). This information was retrieved from an

experimental study comparing generic non-PDO hams and the Parma Ham PDO (Capelli et al.,

2014). No direct surveys or experimental studies were found on the consumers’ quality perception

and WTP of Cinta Senese PDO ham. Nevertheless, key stakeholders and experts interviews allowed

us to infer relevant information about this indicator.

Table 4.4: Attribute Affordability (Economic dimension)

Indicator Unit Data Source

Cured ham

consumption

Tons Nielsen, Parma Ham Consortium

and Cinta Senese Consortium

Retail price in

supermarket

Euro/kg Nielsen, Parma Ham Consortium,

interviews, secondary data

Consumers’ quality

perception

Ordinal scale: level 1 (high quality

perception), level 2 (intermediate quality

perception), level 3 (low quality perception)

Interviews, secondary data

(Capelli et al., 2014)

4.7. Data quality check

Given the high heterogeneity between different attributes and indicators, it is not possible to present

in general the methodology followed for the calculation of indicators. In the next sub-sections all

indicators are presented in a detailed way, also in order to explain theiur relevance for the

evaluation of the selected attributes.

As far as data quality check is concerned, the method provided by the WP3 case study guidelines

has been followed. The guidelines offer a data pedigree matrix method, which assigns numerical

scores to the type of data collected in respect of each of the indicators used in the case studies The

sum of these scores allows researchers to rank their data on an A-E scale, where A represents a

quality class range linked to a high level of ‘real’ quality data. E represents a lower ‘real’ quality of


62

data, indicating that data have been collected from lower-tier or unverified sources; the lower the

QS score, the higher the quality class.

The following table provides for all the indicators the unit of analysis, a short presentation of the

method used for data collection, and the quality classifications for the data used.

Table Indicators, Unit of measeure, method of data collection and quality scoress

INDICATORS Quality score

Name Unit Method

Chain

A

Chain

B

Chain

C

Value added at farm level

Five year average (2009-

2013) for global and

regional chain. Year 2013

for Cinta senese,

average of 3 pig farms

(range 0,26-2,46 €/kg)

Quantitative A A A

Value added at processing

industry

Five year average (2009-

2013) for global and

regional chain. Year 2013

for Cinta senese,

average of 3 ham firms

(range 19-39 €/kg)

Quantitative A A A

V.1 - Feed prices volatility index pure number Statistical A A A

V.2 - Live pigs prices volatility

index pure number Statistical A A A

V.3 - Fresh ham price volatility


V.4 - Cured ham price volatility



integration by ownership % Statistical B B A


integration by contractual

arrangements

ordinal 1,2,3: level 1

(very high part of farmers

is involved: in favour of

resilience), level 2

Intermediate, and level 3

(very small part is

involved: unfavourable to

resilience)

Qualitative B B B

A.3 - Farmers downstream

integration

Ordinal 1, 2, 3: level 1 (a

very high part of farmers

develops downstream

Quantiative

/ Qualitative B B A


63

integration), level 2


(very small part of

farmers develops

downstream integration).

A.4 - Farmers product

diversification

% B B A

A.5 - Farm-level resistance

against price-volatility

€/ kg Quantitative B B B


Ordinal scale: level 1

(very low use), level 2

(some use), 3 (significant

use)

Quantitative

/

Qualitative

B B B

A.7 -

Slaughterhouses/processors

upstream integration


(very high part of

slaughterhouses/process

ors is involved), level 2


(very small part is

involved)

Qualitative B B B





develops downstream



(very small part of

farmers develops

downstream integration).

Quantiative

/ Qualitative B B B

A.9 - Slaughterhouses product

diversification


(high product

diversification), level 2


(very low product

diversification).

Quantiative

/ Qualitative B B B

A.10 - Processors product

diversification

% A A A

A.11 - Processors marketing

channels diversification for cured

ham


(high marketing channels



(very low marketing

channels diversification).

Quantiative

/ Qualitative B A A

A.12 - Processors geographical

market diversification for cured


(high geographical

Quantiative

/ Qualitative B B B


64

ham market diversification),

level 2 Intermediate, and

level 3 (very low

geographical market

diversification).

A.13 - Product differentiation for

cured ham


(high product

differentiation), level 2


(very low product

differentiation).

Quantiative

/ Qualitative B B B

S.1 - Farm-level risk-spreading Ordinal scale: level 1

(high risk-spreading),


level 3 (very low risk-

spreading).

Qualitative /

Participatory

C C C

S.2 - Adaptation capacity of

farmers through downstream

actors cooperation, integration



(high adaptation

capacity), level 2


(very low adaptation

capacity).

Qualitative /

Participatory

C C C

S.3 - Adaptation capacity of

slaughtering firms through

integration and diversification

strategies


(high adaptation

capacity), level 2



capacity).

Qualitative /

Participatory

B B B

S.4 - Adaptation capacity of ham

processing firms through

integration and diversification

strategies


(high adaptation

capacity), level 2



capacity).

Qualitative /

Participatory

B B B

C.1 - Supply chain attitude to

diversification and differentiation


(high attitude: in favor of



(very low attitude).

Qualitative /

Participatory

B B B

C.2 - Intradiversity of chain

relations / configurations


(high intradiversity), level

2 Intermediate, and level

3 (very low

intradiversity).

Qualitative /

Participatory

C C C


65

C.3 - Chain-based adaptation

capacity through learning and

innovation


(high adaptation

capacity), level 2



capacity)

C C C

C.4 - Ability to mobilize public

and societal support


(high ability: in favor of



(very low attitude)

Qualitative /

Participatory

B B B

Trust based internal

relationships

ordinal 1 (maximum level

of trust), 2

(intermediate),3 (low

level of trust)

Qualitative /

Participatory C A B

Trust based external

relationships

ordinal 1 (maximum level

of trust), 2


level of trust)

Qualitative /

Participatory C B B

Self governance capacity ordinal 1 (maximum level

of distinctiveness), 2


level of distinctiveness)

Qualitative /

Participatory C A B

Chain-based value governance nominal: 1,2,3,4,5 Qualitative /

Participatory C B B

LCA.1 - Eutrophication pure number Quantitative A A A

pure number Quantitative A A A



LCA.2 - Carbon foot print pure number Quantitative A A A




LCA.3 - Non renewabel, fossil pure number Quantitative A A A




LCA.4 - Water footprint pure number Quantitative A A A




LCA.5 - Land use pure number Quantitative A A A



66



Association of product with

territory percentage Quantitative

n.a. A A


territory percentage Quantitative A A A


territory


(strong link with the

territory), level 2


(weak link with the

territory)

Qualitative /

Participatory

A A A

Social cohesion and conviviality pure number Quantitative A B B

Social cohesion and conviviality pure number Quantitative A B B


activities

Binary scale: 1 = yes, 0 =

no Qualitative A A A


activities


(more than 40%), level 2

(from 10% - 40%), level 3

(less than 10%)

Qualitative /

Participatory

n.a. B A

Retail price in supermarket pure number Quantitative A A B

Cured ham consumption pure number Quantitative A A A


67

5. Results (performances)

5.1. Value added

According to the calculations carried out on the Interpig data of the years 2009 – 2013 the

value added of pigs raised an fattened in the Netherlands ranges between 0.16 and 0.22 € / kg

liveweight. light pigs. The added value of heavy pigs (160 kg) used in Parma Ham circuit has an

added value which oscillates between 0.19 and 0.32 €/ kg liveweight. The Italian pig farms are thus

on average to add more value per kg pig meat than the Dutch pig farmers.

The Italian heavy pig farmers have to face higher feed costs because:

1. The product specification imposes the use at least 60% of cereals on dry matter basis;

2. The feed conversion rate deteriorates significantly in the phase between 120 and 160 kg.

On the Dutch pig farms 2.60 kg of feed is needed to produce one kg of pig meat,

whereas on the Italian heavy pig farms this feed conversion ratio is 3.68. The average feed price

for fattening pigs for Dutch pig farms in the period 2009-2013 has been 254 € /ton as against

258 €/ton for the Italian pig farms.

Unlike the higher feed costs the pig farmers fattening pigs for Parma Ham do enjoy a

higher value added per kg of meat, as the sales price of the heavy pigs more than compensates

the structurally higher feed prices. The other non factor costs such as energy costs and

veterinary costs do not differe significantly between the two groups of pig farms.

Table 5.1 Value added per kg of Dutch light pigs (€/kg live weight)

Sale price Feed costs Other non factor

costs

Value added

2009 1.02 0.60 0.24 0.18

2010 1.03 0.61 0.22 0.20

2011 1.10 0.76 0.22 0.12

2012 1.26 0.81 0.23 0.22

2013 1.26 0.85 0.25 0.16

Source: Elaborated by CRPA on Interpig data

Table 5.2.Value added per kg of heavy pig (€/kg live weight)

Sale price Feed costs Other non factor

costs

Value added

2009 1.21 0.76 0.22 0.23

2010 1.22 0.81 0.22 0.19

2011 1.41 0.92 0.22 0.27

2012 1.49 0.94 0.23 0.32

2013 1.51 0.96 0.24 0.31


68

Source: CRPA

The results show a higher added value for the heavy pigs used for Parma Ham compared to

the Dutch live pigs. On average, the added value of the Parma pigs is about 50% higher than the

added value of Dutch live pigs.

The added value per kg of liveweight of Cinta Sense pigs in the three farms interviewed was

calculated for the year 2013. It varies between 0.26 and 2.45 €/kg, due to the different feeding

systems and number of heads, with an average value of 1,51 €/kg. The high value added depend on

the high need of labour per head, which derives from the small dimension of the farms, from the

method of breeding and from the low productivity of Cinta Senese breed.

Table 5.3.Value added per kg of Cinta Senese pig (€/kg live weight), year 2013

Sale price Feed costs Other non

factor costs Value added

Az. A 3,63 1,12 0,21 2,30

Az. B 3,5 2,99 0,25 0,26

Az. C 4 1,16 0,38 2,46

Average 3,71 1,75 0,28 1,67

Source: direct survey

Figure 5.1.Value added per kg pigmeat of Dutch light pigs and Italian heavy pig (€/kg live weight)

Source: Elaborated by CRPA on Interpig and CRPA data

0

0,05

0,1

0,15

0,2

0,25

0,3

0,35

2009 2010 2011 2012 2013

Euro

/kg

Value added per kg liveweight

Dutch light pigs

Italian PDO pigs


69

The higher value added per kg of pig meat destined to the PDO Parma Ham certainly can

be attributed to the quality distincteveness of meat of heavy pigs which according to the product

specification are slaughtered at a minimum age of 9 months. At this age the meat reaches a

higher level of maturity which makes this pigs suitable for a series of high quality processed

meat products like Parma Ham, but also products like salamis, mortadella, zampone etc. which

are governed by PDO product specification as well. Meat of pigs slaughtered at an age of about

6 months do not contain these particular quality characteristics. Most of the cuts of their

carcasses are destined to the consumption of fresh meat and very few custs are used for

processed meats.

In order to establish the value added in the processing of imported Dutch hams and of

Parma Ham two groups of companies have been selected either specialized in generic cured

ham or in the production of Parma Ham. The production process show a series of similiarities.

The figure below shows the main features of the production process of Parma ham.

Table 5.4.Main step in production process of Parma ham

° C

Cooling under salt for 6/7 days

1 – 4

Cooling at ° C (2-3 weeks)

1 - 4

Resting period 60 – 90 days 1 – 5

Pre-seasoning until month 7 18 °C

Greasing

Final seasoning until at least 12

months

16°C

1. The fresh hams for Parma Hams need to be cured for at least one year;

2. After trimming both fresh hams stay in refrigerated cells under salt for 6/7 days

3. A second period under salt for 15-18 days according to the weight of the hams

4. The pre-seasoning period until the 7th month

5. At the 7th

month the uncovered meat part of the hams are covered with a mixture of

cereals and fat

6. From the 7th

until the 12th

months the Parma Ham are cured at 16 °C

The generic cured hams follow the same steps of the production process, but as the fresh

hams are lighter and smaller all steps have a shorter duration.

From the calculations based on the company balance sheets made the results show a higher

added value in the case of Parma Ham compared to generic cured ham On average, the added value

of the PDO Parma Ham, 0,41 €/kg, is 30% higher than the added value of generic cured ham, which

registers an added value of 0,28 €/kg.


70

Table 5.5.Value added per kg of fresh Parma Ham with bone (€/kg)

Sale price Purchase price Cost of processing Value added

2009 8.03 3.04 4.37 0.62

2010 8.47 3.82 4.32 0.33

2011 6.76 4.03 2.35 0.38

2012 7.79 4.06 3.36 0.37

2013 7.26 4.07 2.82 0.37

Average 7.66 3.80 3.44 0.42

Source: Elaborated by CRPA on company balance sheets

As can be seen from the tables described the difference varies widely ranging from a

minimum of 4% found in 2010 to a maximum of 48% found in 2009, while in 2012 and 2013, the

difference tends to conform around 25%-

Curing ham demands a high energy input related to the consumption of electricity for air

conditioning the curing cellars. The variable processing costs related to the Parma curing process

clearly appears 67% higher than the costs of curing generic ham. If we examine the price difference

between the sales price of Parma Ham with the purchase price of fresh hams destined to Parma

Ham we end up with 3.58 €/kg, whilst this price difference for generic ham is 2.34 €/kg, which is

64% lower. Although both products operate on the cured ham market, the price difference between

the two products is significant. At wholesale level Parma Hams are sold at 90% higher prices than

generic cured hams, whereas the fresh hams are purchased at more than twice the price of fresh ham

used fo generic cured hams.

Table 5.6.Value added per kg of fresh generic ham with bone (€/kg)

Sale price Purchase price Cost of processing Value added

2009 3.72 1.60 1.80 0.32

2010 4.11 1.66 2.13 0.32

2011 4.03 1.69 2.13 0.21

2012 3.95 1.65 2.04 0.26

2013 4.35 1.85 2.21 0.29

Average 4.03 1.69 2.06 0.28


Figure 5.2.Value added per kg of cured ham (€/kg ham)


71


The case of Cinta Senese cured ham is very specific, because of the great variability of

processing and marketing models, which are completely different from those of the Parma and

Generic hams: the ham processing is often made on farm in small laboratories, the production scale

is small, and all enterprises process and market all the Cinta Senese head. The analysis of three

processing firms representing the two main models (the integrated one, and the long chaan one),

even if indicative because of the complexity of the calculation process, highlights a variability of

value added (year 2013):

- 39.8 €/kg for the smaller company, a family pig farmer and processor which produces 100

Cinta Senese pigs and process 70 of them per year (with some other pigs), marketing all the

products by direct selling channels

- 25.9 €/kg for the bigger pig farmer-processor, which produces 220 Cinta Seense pigs per

year and process 180 of them

- 23 €/kg for the professional ham processor, that process 180 Cinta Senese heads per year

representing the 15% of the total turnover. The contribution of the Cinta Senese processed

products to the overall reputation of the enterprise is very relevant. The value added is very

variable accaroding to the type of processing and to the type of marketing channel. The firm

sell the cured ham also on supermerkets channel, where the value added is lower.

0,00

0,10

0,20

0,30

0,40

0,50

0,60

0,70

2009 2010 2011 2012 2013

Euro

/kg

ham

Generic cured ham

Parma ham


72

5.2. Resilience

See Appendix 1 for a detailed presentation of volatility indicators and of analytical indicators.

5.2.1. Prices volatility results

Indicator Definition Unit Source

Global

chain

Region

al chain

Local

chain

V.1 - Feed prices

volatility index

Coefficient of variation of monthly feed

prices over 3 years (concentrates prices

for heayy and light pigs, representative

agricultural products for feed for Cinta

Senese)

pure

number

CRPA,

Interpig,

Chamber of

commerce of

Siena data)

0,081 0,086 0,099

V.2 - Live pigs prices

volatility index

Coefficient of variation of monthly live

pigs prices over 3 years (Heavy live

Italian pigs for B; Cinta Senese live pigs

for A; Light live pigs imported from NL

not relevant)

pure

number

ISMEA and

Chamber of

Commerce of

Siena data)

n.r. 0,103 0,013

V.3 - Fresh ham price

volatility index

Coefficient of variation of monthly fresh

ham prices over 30 months (Fresh ham

14 kg for generic ham ; Fresh ham 11-

13 kg for Parma PDO ; not relevant for

Cinta Senese)

pure

number CUN data 0,053 0,051 0,013

V.4 - Cured ham

price volatility index

Coefficient of variation of monthly

cured ham prices

pure

number

Parma market

data 0,049 0,04 n.a.


73

5.2.2. Pig farming results



Global

chain

Regiona

l chain

Local

chain

A.1 - Farmers

upstream

integration by

ownership

% of pig farmers which

self-produce the majority

of feed

%

UNIFI-

UNIPR-

CRPA

100 90 70

A.2 - Farmers

upstream

integration by

contractual

arrangements

Part of pig farmers

involved in mid-long

term upstream

contractual arrangements

with animal feed

producers

ordinal 1,2,3: level 1 (very high

part of farmers is involved: in

favour of resilience), level 2

Intermediate, and level 3 (very

small part is involved)

UNIFI-

UNIPR-

CRPA

3 2 3

A.3 - Farmers

downstream

integration

Relevance of farmers


Ordinal 1, 2, 3: level 1 (a very

high part of farmers develops

downstream integration), level

2 Intermediate, and level 3

(very small part of farmers).

UNIFI-

UNIPR-

CRPA

3 2 2

A.4 - Farmers

product

diversificatio

n

% of (light/ heavy/Cinta)

pigs for ham production

on the total turnover of

farm

% UNIFI-

UNIPR-

CRPA

100% 90% 53%

A.5 - Farm-

level

resistance

against price-

volatility

Price volatility of the

input and output markets

of relevance for pork

production, defined as

the max delta added

value per kg live weight

per year over the periode

2009-2013

€/ kg GLAM

UR

0,10 0,13 n.a.

A.6 - Use of

antibiotics

Use of antibiotics in pig

farms

Ordinal scale: level 1 (very low

use), level 2 (some use), 3

(significant use)

Expert

consulta

tion

3 3 1


S.1 - Farm-level risk-spreading

On the basis of the value of the indicators related to farmers upstream integration in feed

production and of product diversification, which are reported in the table below, a qualitative

synthetic evaluation about the level of risk-spreading was formulated on a three-levels scale.

Generic ham (global) Parma PDO (regional) Cinta S. PDO (local)

Farmers upstream integration by

ownership (self-production of feed)

0% 10% 30%

Farmers upstream integration by

contractual arrangements with feed

producers

3 2 3

Farmers product diversification 0% 10% 47%


74

Results of the comparison are expressed in the following table. Cinta Senese pig farmers are

in general quite able to deal with input and output price volatility thanks to vertical integration

strategies : a) in upstream feed production, and b) in downstream ham processing activities.

However these are strategies at firm-level, therefore there is a varied range of farm-level resistance.

According to analytical indicators, local supply chain performs better than the other for two of the

three indicators considered in the analysis. Cinta Senese chain can be considered more resilient due

to the direct control of feed supplying and to their high diversified in many different activities than

production of pigs. In fact many pig farmers produce other agricultural products like olive oil, wine,

cereals, and/or practice forestry, and/or diversify in agritourism activities. Additionally, often the

members of the family work also in non-agricultural sector.

On the other side generic ham pork farmers are the lower degree of risk-spreading due to

their high specialization and dependence on market for their supplying. The regional chain is in an

intermediate position.

Farm-level risk-spreading Indicator S-1 Cured ham chain Value Notes

Risk-spreading by farm-level diversification and

producing feed.

This indicator synthesizes indicators B1,B2, and D1.

Generic ham (global) 3 Qualitative-participatory

Parma PDO (regional) 2 Qualitative-participatory

Cinta S. PDO (local) 1 Qualitative-participatory

NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high risk-spreading: in favor of resilience), level 2

Intermediate, and level 3 (very low risk-spreading).

Source: our findings

S.2 - Adaptation capacity of farmers through downstream actors cooperation, integration


This indicator take in account two analytical indicators, farmers product diversification and

farmers downstream integration, integrated by other qualitative evaluations made by researchers on

the basis of their direct knowledge, literature analysis and interviews with supply chain actors.

Global supply chain presents very low levels of adaptation capacity, there are very few

initiatives by farmers aiming at downstream integration, and there are not opportunities to develop

collaborative initiatives with downstream actors of the generic cured ham chain. This is also due to

the geographical distance between pig farmers (mainly the Netherlands and other northern

countries) and ham processors, but mainly because differentiation strategies in the generic ham

chain are based only on individual processors trademarks.

For the Regional supply chain the situation is not much better, despite the strong

diversification strategies linked to Parma Ham PDO. In fact the real degree of involvement of pig

producers in PDO is low, and heavy pigs farmers are not able to really connect actively to these

strategies and to develop vertical integration and diversification strategies.

In Cinta Senese chain there is a very heterogeneous situation. Some pig farmers process

their own pigs developing downstream integration at firm level; this allow them for a good

valorization of their pigs also by means of marketing strategies centered on the full control by

farmer of all the process and on the artisanality of process and products (hams and other could cuts).

For Cinta Senese farmers who sell their pigs to downstream firms the situation is diversified: some


75

pig farmers are linked by means of contractual arrangements to ham processors, while other farmers

act in a completely disconnected way from ham processors, without any coordination. In general,

despite the PDO the actors complain however the lack of systemic initiatives at the collective level.

Adaptation capacity of farmers through downstream actors cooperation, integration and

diversification strategies Indicator S-2 Cured ham chain Value Notes

Strength of interlinkages with downstream actors

diversification strategies in terms of productfolio -

and marketing

Generic ham (global) 3

Parma PDO (regional) 3

Cinta S. PDO (local) 2

NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high adaptation capacity: in favor of resilience), level 2

Intermediate, and level 3 (very low adaptation capacity).


5.2.3. Slaughtering results



Global

chain

Regional

chain

Local

chain

A.7 –

Slaughterhouses /

processors upstream

integration

Part of

slaughterhouses/processor

s involved in pig farming

and/or in long term


ordinal 1,2,3: level 1 (very

high part of firms

involved), level 2


(very small part)

UNIFI-

UNIPR-

CRPA

3 2 1

A.8 -

Slaughterhouses

downstream

integration

Relevance of

slaughterhouses




develops downstream



(very small part of farmers).

UNIFI-

UNIPR-

CRPA

3 2 3

A.9 -

Slaughterhouses

product

diversification

Part of activity not linked

to production of generic /

Parma PDO / Cinta

Senese ham on the total

turnover of slaughtering

firms

Ordinal scale: level 1 (high

product diversification),


level 3 (very low product

diversification).

Expert

consultati

on

2 3 1

Synthetic indicator

S.3 - Adaptation capacity of slaughtering firms through integration and diversification

strategies

Slaughtering sector plays very different roles in the three supply chains considered. In the

global chain the slaughtering sector is dominated by big firms which have a strong market power

and pursue their own conglomerate strategies; slaughtering activities are managed outside the

region where the cured ham is processed, in Netherlands or in other EU Northern countries (see the

Dutch report for more details on the characteristics of slaughtering sector in the Netherlands).

Conversely, in the Cinta Senese sector slaughtering firms are very small (because breeding has

become an activity of secondary importance in Tuscany region) and merely play a role of


76

slaughtering service of Cinta Senese pigs on behalf of pig farmers or of pig meat processors; their

role in the strategic management of the chain is very limited even if very relevant from a technical

point of view (also because of the relevance of transportation costs of live Cinta Senese pigs from

farms to slaughterhouses).

The strategic involvement of slaughtering firms in the cured ham is very different among

different local, regional and global chain. Cured ham is only one of many markets for the

slaughtering firms in the global chain; the same, but for different reasons, happens in Cinta Senese

chain, where the slaughtering of Cinta Senese pigs is a very marginal and episodic activity, and

often perceived by firms as a burden than as a business. On the contrary, slaughtering firms in PDO

Parma Ham area are very involved in the cured ham chain with the aim of increase resilience by

capturing the value added generated in the processing industry. By means of take overs and mergers

the main Italian slaughterhouses control more than 50% of the production of Parma Ham.

Big slaughtering firms in both global and regional chains develops strategies aiming at

control and coordinate quantities, quality and prices of live pigs also through upstream vertical

integration, in order to be able to better meet intermediate and final demand needs. In particular

vertical integration is increasing in heavy Italian pigs sector; this allows an increased resilience for

the whole Parma Ham chain, but can create unbalanced market relationships. In Parma Ham chain

also downstream vertical integration is increasing, by means of direct ownership of farms, but

primarily through long term contracts with pig farmers .

Summarizing these results in the synthetic indicator “Adaptation capacity of slaughtering

firms through integration and diversification strategies” is not a simple task, because of the

complexity of the issues and partly conflicting indications that come from the analytical indicators.

According to the Glamur expert team, Cinta Senese and Parma Ham chains have both an

intermediate level adaptation capacity, but for different reasons. In the Cinta Senese chain the result

comes mainly from the diversification of slaughterhouses, which, however, are not dynamic and

able to develop proactive strategies. Instead in the regional chain there is an the high dependence of

firms from the chain of Parma Ham PDO, but some firms are able to develop strategic initiatives

seeking for a better product qualification. Heavy pigs slaughtering is concentrated in a few large

companies (about 10), compared with about 120 certified slaughterhouses. The resilience of these

large slaughtering companies is based on economies of scale and on vertical integration strategies

implemented both by slaughterhouses towards cured ham factories, and by feed mills towards

slaughterhouses by means of agistment contracts with pigs farms.

Adaptation capacity of slaughtering firms through integration and diversification strategies

Indicator S-4 Cured ham chain Value Notes

Synthetic indicator based on upstream, downstream and

diversification analytical indicators








77

5.2.4. Ham processing results



Global

chain

Region

al chain

Local

chain

A.7 -

Slaughterhouses/proc

essors upstream

integration

Part of


s involved in pig farming

and/or in long term



(very high part of


s is involved), level 2


(very small part is

involved)

UNIFI-

UNIPR-

CRPA

3 2 1

A.10 - Processors

product

diversification

Share of processing firms

with a share of (generic /

Parma PDO / Cinta

Senese) ham higher than

70% on the total turnover

of processing firms, on

the total number of firms

%

UNIFI-

UNIPR-

CRPA

33% 49,50% 0%

A.11 - Processors

marketing channels

diversification for

cured ham

Degree of market

diversification of ham

processors, in terms od

marketing channels


(high marketing channels



(very low marketing

channels diversification).

UNIFI-

UNIPR-

CRPA

1 2 1

A.12 - Processors

geographical market

diversification for

cured ham

Degree of market


processors, in terms od

geographical markets


(high geographical market



(very low geographical

market diversification).

UNIFI-

UNIPR-

CRPA

2 2 3

A.13 - Product

differentiation for

cured ham

Degree of product

differentiation for cured

ham by means of

collective labelling

systems


(high product

differentiation), level 2


(very low product

differentiation).

UNIFI-

UNIPR-

CRPA

2 1 2


S.4 - Adaptation capacity of ham processing firms through integration and diversification

strategies

Ham processing firms are at the heart of the cured ham chains. Data about volatility indexes

highlight that Parma supply chain have a volatility, for both fresh hams and cured hams, lower than

generic ham chain. This may be the result of a greater adaptation capacity of Parma Ham PDO

processing firms. These firms in fact are dependent on ham production, but they are able to

differentiate their products on the market by means of PDO collective mark which is very reputed

on Italian and foreign markets, also thanks to collective marketing initiatives carried out by the

Parma Ham Consortium. The level of geographical market and marketing channel diversification is

good. What is relevant to say is that some Parma Ham processing firms have increased their


78

adaptation capacity through the entry in the segment of generic ham. According to Glamur expert

evaluation, the adaptation capacity of Parma Ham processing sector is high.

In local (Cinta Senese) supply chain PDO on fresh Cinta Senese meats play a relevant role,

even if its reputation is lower than in the Parma Ham also because not supported by strong

collective marketing initiatives. A number of firms processing Cinta ham are farmers which

integrate downstream; specialized Cinta ham processors are not dependent from Cinta Senese

because it represent only a small part of their business. Ham processors more involved in Cinta

Senese and interested in high quality products tend to a strong control over pig farming, by means

of ownership or agreement with pig farmers mainly based on trust. According to Glamur expert

evaluation, the adaptation capacity of Cinta ham processing sector is intermediate, also compared

to the Parma Ham chain.

The capacity of adaptation of generic ham processing firms is more linked to marketing

channels diversification and rest on the development of individual trademarks, which only may

allow to escape a very strong price competition, and on the reputation of Italian traditional hams

(like the Parma PDO). The development of the chain of generic ham is born as a strategy of

differentiation of some Parma Ham producers, in order to have in their product portfolio a low-price

cured ham (very attractive in times of crisis of domestic demand). Generic cured ham is interesting

for firms because of faster a faster capital disinvestment cycle (thanks to the shorter period of

maturation). Generic ham consumption is now increasing also because it feed the sector of pre-

sliced ham sold under the umbrella marks of supermarkets.According to Glamur expert evaluation,

the adaptation capacity of generic ham processing sector is close to Parma Ham.

Adaptation capacity of ham processing firms through integration and diversification strategies

Indicator S-4 Cured ham chain Value Notes

Synthetic indicator based on upstream,

downstream, diversification and differentiation

analytical indicators




NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high adaptation capacity: in favor of

resilience), level 2 Intermediate, and level 3 (very low adaptation capacity).


Cross-cutting indicators

C.1 - Supply chain attitude to diversification and differentiation

The overall level of the supply chain attitude to diversification and differentiation can be

evaluated by means of related analytical indicators, which are synthesized in the following graph.

Firms belonging to the local supply chain are more oriented to product diversification, while the

regional supply chain is strongly oriented to product differentiation in order to escape from market

competition by consumer loyalty; the high level of specialization of firms in the regional chain

tends to limit the degree of resilience.


79

Figure 5.3 Analytical indicators related to diversification and differentiation


Supply chain attitude to diversification and differentiation Indicator C.1 Cured ham chain Value Notes

Synthetic indicator based on diversification and

differentiation analytical indicators related to all

stages of the supply chain




NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high attitude: in favor of resilience), level 2

Intermediate, and level 3 (very low attitude).


C.2 - Intradiversity of chain relations / configurations

In the Cinta Senese supply chain there are three main types of organization, that is the fully

integrated firm (a pig farmer that produces part of feed and process their own pigs selling them to

final consumers), the contract model (an ham processor buy Cinta pigs from farmers on the basis of

– written or not – mid-term agreements), and the market model (where the coordination is left to

interaction between supply and demand on single basis). These three models are complementary

and each of them has specific abilities to resist against different risk factors.

In both Parma and generic ham chains there is a lower degree of intradiversity. Some more

artisanal firms exist close to very “industrial” big firms (often slaughterhouses and processing firms

operating in Parma PDO chain process also non-Parma Hams), but the dominant model is based on

big firms pursuing scale economies and marketing mainly to big supermarkets firms.

0

20

40

60

80

100

D.1 - Farmers productdiversification

D.2 - Slaughterhouses productdiversification

D.3 - Processors productdiversification

E - Processors marketingchannels diversification for

cured ham

F - Processors geographicalmarket diversification for

cured ham

G - Product differentiation forcured ham

Global (Generic ham) Intermediate (Parma Ham PDO) Local (Cinta Senese PDO)


80

Intradiversity of chain relations / configurations Indicator C.2 Cured ham chain Value Notes

Intradiversity of chain relations / configurations Generic ham (global) 2



NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high intradiversity: in favor of resilience), level 2

Intermediate, and level 3 (very low intradiversity).


C.3 - Chain-based adaptation capacity through learning and innovation

In the Cinta Senese supply chain there is a limited ability of pig farmers in learning and

innovation, also due to the very limited dimension of farms. The large majority of pig farmers are

disconnected from a technical assistance system and they are not able to really innovate; indeed

often a resistance to change was detected, as well as to communicate or collaborate with other

firms. The same happens for firms (vertically integrated farmers and specialized firms) involved in

ham (and pig meat) processing. At the same time the Cinta local production system (with the

support of local administrations and breeder organizations) was able to elaborate the application for

a PDO and now is capable to support the collective reputation of the product on the market. As a

conclusion, chain-based adaptation capacity seems more developed for market issues than for

technical issues.

In the Parma Ham supply chain the adaptation capacity through learning and innovation at

farm level is quite low, primarily because of the lack of a common and unique direction of the

breeding program. A lack of collaboration in the chain does not allow the emergence of a common

future vision on the Parma Ham chain, for example with reference to internal quality grading. At the

ham factory level instead learning and innovation are at a good level: in this stage of the chain

attitude to innovation is supported by a strong collaboration between firms, by technical assistance

provided by the Experimental Research Station for Processed Food, and also by the local

mechanical industry (mainly small and medium enterprises) highly specialized in providing

equipment to ham factories.

The global chain benefits from the spillover effects coming from the Parma chain, also

because of some important firms operates simultaneously in both chains. Differently than the Parma

Ham, this learning and innovation capacities are not really chain-based, because of the lack of

involvement of (foreign) pig breeders and slaughtering firms.

Chain-based adaptation capacity through learning and innovation

Indicator C.3 Cured ham chain Value Notes

Chain-based adaptation capacity through learning

and innovation








81

C.4 - Ability to mobilize public and societal support

According to the analysis of policies, to interviews and researchers’ direct knowledge, the

ability to mobilize different types of public and societal support is more developed in both Cinta

Senese and Parma Ham supply chains.

Cinta Senese has benefited greatly from incentives and technical assistance measures for the

recovery of the breed, which in the 90s was considered at risk of genetic erosion. Regional and local

public authorities (Provincia of Siena) contributed to the PDO registration. Also regional

Universities (Pisa and Firenze) contributed to developing relevant knowledge about the breed and

rearing systems. Cinta Senese is perceived as an identitary product, and also local population in

many rural areas are available to support this pig breed. On the other hand the system representation

of the supply chain is not so strong, representative and organized to orient in their favor local public

policies in a systematic way.

Parma PDO ham enjoys a similar situation of interest by public authorities. Given the strong

economic role Parma Ham plays in the territory of Parma and near Provinces, local authorities are

available to support this supply chain. The Parma Ham Consortium is well organized and

representative, and is able to play their lobbying role at local level.

Generic ham supply chain is less able to mobilize public and societal support, also because

the companies are not organized in a specific Consortium Many companies though adhere to the

association of meat processors (ASSICA), which lobbies at national and international level for

policies favorable for this sector . Moreover, it can benefit from trickle down effects from the Parma

Ham chain, considering that some firms operating in Parma Ham produce also generic cured ham.

Ability to mobilize public and societal support Indicator C.4 Cured ham chain Value Notes

Presence of political and social support activities of

various types, at national, regional and local level




NOTE: the ordinal scale is the following: Ordinal scale: level 1 (high ability: in favor of resilience), level 2

Intermediate, and level 3 (very low ability).


5.2.5. Performance comparison

Resilience is a multifacetted and complex attribute, which can be evaluated at firm, sector

and supply chain level; it should not be considered only as the capability of a system to absorb

external disturbances but also in a dynamic way. The ability to evolve towards new equilibria

without change its identity is a key feature of resilient supply chains.

Our analysis put in evidence that cured ham pork chains undergo the pressure of many

factors and are embedded into a context that evolves rapidly. Price volatility is one of the major

factors of instability. An overview of the different indicators of volatility does not allow to draw

general and uniform conclusions about the performance of the three supply chains. The local supply


82

chain present higher values of volatility for feed, due to the narrowness of the market which derives

from the obligation of local purchasing, but a very low volatility of live pigs prices; due to the niche

character of the final market it is not possible to calculate volatility on the final market. The global

chain is less exposed to volatility than the regional one (Parma) in the upstream phases of the chain,

and more exposed in the downstream phases. These evidences should be interpreted on the basis of

actors’ (individual and collective) behaviour. A working hypothesis is that the Regional supply

chain can better control prices of the final product thanks to the PDO differentiation strategy.

Volatility Indexes : overview

Supply chain

Feed

Indicator V.1

Live pigs

Indicator V.2

Fresh ham

Indicator V.3

Cured ham

Indicator V.4

Generic ham (global) 0.081 N.R. 0.053 0.049

Parma PDO (regional) 0.086 0.103 0.051 0.040

Cinta S. PDO (local) 0.099 0.013 0.013 Very low


Synthetic indicators and cross-cutting indicators evaluated for the three chains are depicted

in the following graph, that highlights the good performance of the local chain, the Cinta Senese

one, while the worst performance is from the global chain (generic cured ham).

Figure 5.4 Analytical indicators related to diversification and differentiation

0

20

40

60

80

100S.1 - Farm-level risk-spreading

S.2 - Adaptation capacity of farmersthrough downstream actorscooperation, integration and


S.3 - Adaptation capacity ofslaughtering firms through

integration and diversificationstrategies

S.4 - Adaptation capacity of hamprocessing firms through

integration and diversificationstrategies

C.1 - Supply chain attitude todiversification and differentiation

C.2 - Intradiversity of chain relations/ configurations

C.3 - Chain-based adaptationcapacity through learning and

innovation

C.4 - Ability to mobilize public andsocietal support



83

The resilience performance profiles of the three cured ham supply chains can be synthesized

as follows

- Regional supply chain: Parma cured ham chain have an high level of resilience, mainly

thanks to ham processing firms that are the core actors in the chain. The chain is

characterized by a good adaptation capacity through learning and innovation. This

satisfactory level of resilience is obtained partly at the expenses of pig breeders, who seems

to be the weak stage of the chain. The ability to mobilize public support is a relevant feature

in Parma Ham chain. Two interconnected factors helps chain resilience: the Product

designation of origin link the product to the territory to one side and to consumers on the

other, and the strong governance system (Parma Ham consortium) that helps collaboration

between firms and interaction with other local stakeholders.

- Local supply chain: Cinta Senese ham chain have an high resilience in terms of recovering

from shocks but intermediate in terms of search for new equilibria. The performance is good

in particular in terms of diversification, differentiation and intradiversity of chain

organizational configurations, allowing for risk-spreading. This good performance originates

from a low dimension and a subsequent low level of specialization of firms, which on the

other side causes an intermediate performance in terms of adaptation capacity and learning

and innovation. The Product designation of origin, even if it cover only the fresh meat, play

a relevant role.

- Global supply chain: the generic cured ham present the lower degree of resilience. It

presents an high exposure to risk and low opportunities for collaboration between different

phases of the chain. Considered the territorial contiguity and the fact that many PDO ham

firms produce also generic ham, the global supply chain benefit from spillover effects from

Parma Ham sector and helps the level of resilience of the Parma Ham chain.

Local and regional chains seems to be less vulnerable to volatile prices and to risks in

general, for the following main reasons:

- regional and local supply chains are more diversified, both at single firm level, in terms of

market diversification and product differentiation, and at a whole supply chain level, in

terms of intradiversity of business models and chain relations

- pig breeding is more centered on local resources and then less dependent on world markets,

in particular for feed provision

- local and regional chains more able to raise consumers prices thanks to strong differentiation

initiatives centered on regional non-reproducible factors. The ability to differentiate the

product on the basis of “irreproducible” factors (as breeds, rearing methods, specific

processing abilities, …) can have a relevant impact on resilience. Some of these factors are

linked to specific territories in their physical and cultural identity, giving a potential

advantage to local and regional cured ham chains. Institutional tools for the protection and

assurance of food quality, like Protected designations of origin, play a key role in building

these product regional identities

- firms in local and regional chains are more motivated to develop collaborative relationships

with other firms: in principle territorial and cultural contiguity allows for better


84

opportunities of coordination, lowering transaction costs, easing common vision about

different supply chain actors and generating awareness about the interdependence with other

firms operating in the area defined according to the PDO. In the case of the Parma Ham is

possible to identify a real organizational model of the type “agrifood industrial district”

(Mora and Mori, 1995; Arfini and Mora, 1998; Giacomini et al., 2013b). ).

- Horizontal collaboration amongst producers and vertical collaboration between different

stages of the chain is more developed, in particular in the case of the Parma Ham, arising

from collective action and governance developed by means of the Consorzi di tutela.

5.3. Chain governance

5.3.1. Indicator "Trust based internal relationships"

Internal relationship is considered one of the main aspects responsible of quality

management and transmission of quality and price signals to the market. Trust plays a fundamental

role since the quality of the meat is not evaluated by objective criteria but instead by subjective

criteria of chain agents and since the organisation of the chain that imply to procure raw material

from suppliers that are far from the processing area. Level of trust-based relations between chain

actors, is based on the observation of three parameters: i) absence of conflicts, 2) trust among chain

partners, 3) continuity of chain relations.

Table 5.7 Indicator “Trust based internal relationships”

Supply chain Name Value * Notes

Global chain: Generic cured

ham 3 Direct interview to supply chain operator

Regional chain: Parma Ham

PDO 2 O’Really et al. (2003), Dentoni et al. (2012)

Local chain: Cinta Senese

PDO 2 Direct interview to supply chain operator

* Ordinal scale: level 1 (maximum level of trust), level 2 (intermediate level of trust), and level 3 (minimum level of

trust).

Source: our elaborations.

On the basis of interview to economic actors appear evident as the “Global chain cured

ham” present the lowest level of trust due to the variability in quality and the continuous research of

lowest price of pig cuts. In this chain do not exists specific certifications systems and coordination

system at institutional level thus problems related to the quality of the meat have to be managed by

ham factories located in Parma district and elsewhere in Italy where the generic ham companies

operate.

Regional chain present a lower level of conflict with respect the global chain but research in

this filed (O’Really et al., 2003; Dentoni et al., 2012) and direct interviews shows the presence of


85

conflicts between farmers and slaughterhouses and between slaughterhouses and PDO ham

processor. According to the PDO product specification quality is standardized, nevertheless fresh

ham characteristics could differ according to pig breed, feed quality, farm management systems and

ham weight. Slaughterhouses differentiate meat quality of the fresh ham according to the quality

strategies of their costumer. Relationship are based on trust between actors but sometime

slaughterhouses may favour some costumer instead of other clients. The presence of the PDO

Consortia and the regional dimension of fresh and cured ham market create the condition of a social

control between economic actor increasing the level of trust.

Local chain of Cinta Senese present a strong social control process along the chain.

Interviews of pig producers and processor shows some conflict arise between actors due to

presences of “new” pig farmers that, have started the breeding of Cinta Senese pigs due its market

success, but have modified the equilibrium among the chain actors. In particular they have an

impact on prices and on quality to a more intensive breeding technique in pig managements. For

this reason, even though the presence of common rules and the active participation of local actors,

the presence of conflicts is reduced without resetting.

5.3.2. Indicator "Trust based external relationships"

External relationships plays a relevant role for manage the political and social dimension of

the food chain in each area of production. This indicator consider the ability to create the ability to

connect with territorial and policy stakeholders (at local, national and European level) with the aims

to develop appropriate actions of local development of marketing promotion but also to create a

political and social consensus for adoption of appropriate policy intervention that support the chain.

Trust plays a fundamental role since the perception of stakeholders is based on the reputation and

lack of opportunistic behaviours of chain members. External relationship indicator is then evaluated

on the chain partners' capacity to mobilise support from: i) social movements, ii) citizens and iii)

policy actors. This indicator is evaluated by the use of quality approach mainly based on direct

interviews to relevant stakeholders and by specific publication.

Table 5.2 Indicator “Trust based external relationships”


Global chain: Generic cured

ham 3 Direct interview to supply chain operator

Regional chain: Parma Ham

PDO 2

O’Really et all., 2003; Parma Ham PDO

Consortium, Annual Yearbook, several years;

Local chain: Cinta Senese

PDO 1

Direct interview to supply chain operator; Cinta

Senese Consortium: Annual Yearbook, several

years; Website;

* Ordinal scale: level 1 (maximum level of trust), level 2 (intermediate level of trust), and level 3 (minimum level of

trust).



86

On the base of interview to economic actors the “Global chain cured ham” presents the

lowest level of trust due to the main reason that this chain is “hidden” to most of territorial social

actors and local policy makers. In the past this chain was a minor production of the Parma Ham

district but nowadays the size of this production is greater of the PDO hams. Local policy actors

consider positively the presence of a global chain for the link with the economic growth and for the

implication of employment inside the indsutrial district, but they recognize the presence of negative

externalities specially at environmental level. In addition, the same local policy actors are worried

about the possible of negative economic impact on the economic performance of the Regional

chain. As consequence the trust on global external relationship is considered very low.

Meanwhile Regional chain present a higher trust level among social and economic actors

and on policy makers too. Reputation come from Parma Ham Consortium, the relevance of the

economic sector and the strong culinary tradition of Parma area. At the same time PDO Parma Ham

Consortium show high ability to cope with policy actors by means of a strong lobbing activity.

Members of PDO Parma Ham consortium are present in different national and international

organisation aiming to protect and promote PDO products include Parma Ham. PDO Parma Ham

Consortium shows high capacity to talk with public institution at local, regional and national level.

A partial drawback is due to the “distance” between local consumers and local producers. Even if

the product is very well know and used, PDO producers are not know at the outlet and is difficult

for consumers distinguish small producers of artisanal PDO Ham respect larger producers of more

industrial PDO ham. In addition, PDO Parma Consortium shows low interest to initiative aimed to

promote local economy by means of territorial marketing actions as the participation to the Quality

route of wine and Ham that collect local producers.

Considering the local chain of PDO Cinta Senese, analysis conducted by interview of local

stakeholders and members of PDO Consortium appear evident as the whole is very rooted in the

territory of production by the strong involvement of local stakeholders. Local administrations (like

Siena Province and some Municipalities) play an important role in developing and supporting the

governance of the PDO system. This feature underline the territorial governance that surround the

activity of the Consortium that, in turn, influence the governance of the PDO chain. The link with

local policy makers is reinforced by the initiative of the Consorzio di Tutela della Cinta Senese,

which is asking for its acknowledgement by the Ministry of Agriculture, in order to be able to act

according to the “erga omnes” criterion, allowing to extend control activities to farms and

companies not associated within the consortium. In sum, external trust on PDO Consortia and on its

members by local stakeholders is very high and is the result of the strong territorial approach of the

Chain governance.

5.3.3. Indicator "Self governance capacity"

Self governance capacity is considered as the capacity of the chain to adopt appropriate

policy and strategies for create, maintain and increase distinctiveness on the product and on the

producers. This indicator deal with the capacity of the chain to create the condition of market

success by offering the appropriate quality to costumers trough different retails models. This

indicator is strongly related to the previous indicators and reproduce how the presence of trust,


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combined with management capacity, is able to solve conflict and adopt appropriate governance

strategies with respect intrinsic and extrinsic feature of the goods sold by different retail systems.

This indicator is evaluated by the use of quality approach mainly based on direct interviews to

relevant stakeholders and by specific publication.

Table 5.3 Indicator “Self governance capacity”


Global chain: Generic cured ham 3 Direct interview to supply chain operator

Regional chain: Parma Ham PDO 1

O’Really et al. (2003); Parma Ham PDO

Consortium, Annual Yearbook, Istituto Parma

Qualità Certification body; Dentoni et al. (2012)

Local chain: Cinta Senese PDO 2

Direct interview to supply chain operator; Cinta

Senese Consortium: Annual Yearbook, several

years; Website;

* Ordinal scale: level 1 (maximum level of distinctiveness), level 2 (intermediate level of distinctiveness), and level 3

(minimum level of distinctiveness).

Source: our elaborations

The Global value chain do not have governance bodies (such as Consortia or producers'

associations); thus, apparently, the definition of rules and distinctiveness strategy are left to the

initiative of the single producers. These latter initiatives follow as a “guide”: i) the quality standards

of the PDO Parma Ham (since producers adopt procedures very similar to those used for the Parma

Ham PDO and with the same technologies); ii) others marketing signals or labels, such as retailer

private labels (producers must meet their customers standards, in particular those of the large scale

retailers, especially if hams are sold sliced in trays with commercial brands).

Considering the regional chain of the Parma Ham PDO, the PDO Consortia has demonstrate

along the time a strong capacity to define and manage the quality system for the whole chain coping

possible quality variability with respect: i) the territorial distribution of the chain – pigs can be

breed in 10 Italian regions -; ii) the dimension of the chains – more than 4000 pig farmers are

registered in the Parma Ham Control plan -; iii) the innovation systems along the chain both at

farmers level – introduction of new breeding systems that has innovate the animal welfare

standards, the feeding techniques, etc.. - and at processor level – ham producers have to comply

with new hygienic regulations from UE and have introduced new technologies for refrigerate and

ripen meat -; iv) market innovation – the segment of sliced ham sold in food trays is increasing

every year and represents the most innovative market segment for the Parma Ham PDO chain. The

capacity to manage quality and to produce distinctiveness is due to the composition of the PDO

Consortia board –the Board composition reflect the structure of the PDO chain and include

representatives of farmers, and ham producers differentiated by size of productions – and by the

presence of a effective marketing office that cover the necessity of the domestic and international

market. Giving this structure, the PDO Parma Ham Consortium is able to manage the image and the


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reputation of Parma Ham - also by effective advertising campaign using different media channels

and by participation on food fairs at national and international level – and support their members to

implement promotional campaign in outlets. The self-governing capacity is strengthened by the fees

that members pay to the PDO Consortium for all its activities, and allow to employ efficient and

capable managers that represent adequately the whole PDO chain.

Finally the local food chain represented by the Cinta Senese PDO is show also a good self-

governace capacity by means of a representation of the chain in the PDO Consortia. Most of the

producers of Cinta Senese pigs are member of the Consorzio, as well as many firms involved in

processing - traditional farmers, entrepreneurs/farmers and pork processors – and provide effective

strategies for increase the quality and the reputation too. The activity of the PDO Consortium is

supported by INEQ that is the PDO Control body, which control the conformity of PDO fresh meats

to the PDO Product specifications. It is an independent body (3rd party certification), according to

the EU PDO-PGI rules. The objectives of the PDO Consorzio di Tutela della Cinta Senese is

changing over the time. In the 90s was to prepare the necessary information and documents for the

application of the PDO label on Cinta Senese meat, and after the PDO registration to assemble all

interested actors in one organisation having the objective to defend the interest of its members,

safeguarding the breed, developing marketing activities. Nowadays there are different strategic

visions between those who want to keep a close rural dimension (enhancing both the product and

the territory) and who wants to promote primarily the product separating, in part, from the territory.

Because the PDO Consortium is “small”, “local and agricultural dependent” do not have the

economic independence and the economic strength to develop “alone” effective strategies that

increase distinctiveness on the market by promotional campaign. In addition the self-regulation

capacity is influenced by the difficulties to find a common strategic vision for “old” and “new”

chains members.

5.3.4. Indicator "Chain-based value governance"

Overall value governance characteristics are conform the typology described by Gereffi et

al. (2005) in its paper on governance typologies of value chains. Gereffi and his colleagues consider

the presence of 5 governance typologies and the basis of the characteristics of transactions: Market,

Modular value chains, Relational value chains, Captive value chains, and Hierarchy.

Table 5.4 Indicator “Chain-based value governance”

Chain governance model

Global chain

Generic cured ham

Regional chain

Parma Ham PDO

Local Chain

Cinta Senese PDO

Market high low low

Modular medium low absent

Relational absent high high

Captive high medium medium

Hierarchy medium low absent

Source: our elaborations on Gerffi et al. (2005).


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The three chains do not present a single governance model since the each phase of the chain

(breeding, slaughter and processing) present different networks, dynamics and governance

strategies. Table 5.4 reproduces for the chain the intensity of each governance model in each chain.

Regarding to the global chain the dominant governance models are the Market model and

the Captive model. Both are present at farmers and processing level since is observed the lack of

stability in trade relationships and the strong influences of larger buyer. Nevertheless, modular and

hierarchy models are present for some ham processing companies.

The regional chain is the most fragmented one since the three chains phase present own

specificity in trade and quality relationships among chain members. The dominant governance

model is the Relational model given the presence of complex interactions between buyers and

sellers, which often creates mutual dependence and high levels of asset specificity. It should be

noted the presence of Captive governance model due to the strong activity control by private

certification body that act for guarantee quality to big retailer. Even in the Parma Ham PDO system

other governance form are present, even if do not involve the majority of companies.

Finally, the local chain present a dichotomy of governance model: the relational and the

captive model. The first one is due mainly to the strong connections between the members of the

chains between them and with their customers. This model involve mainly the old members of the

Cinta Senese Chain. On the other hand, the “new” members adopt a strategy more close to the

Captive model since they are dependent from market signal and larger buyers. Even so, a small part

of pig producers sell their pig on the “free” market without any type of agreement.

A graphical overview of the three indicators with difference in performance is described in

Figure ***


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Figure 5.5 : Difference of performance of local, intermediate, global chains for “Chain Governance” attribute.

Note: all the measurement indicators have been linearly transformed on a 0-100 scale.

0

20

40

60

80

100

Trust basedinternal

relationships

Trust basedexternal

relationships

Self governancecapacity

Global (Generic ham)

Intermediate (Parma Ham PDO)

Local (Cinta Senese PDO)


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5.4. Territoriality

The “Association of the product with territory” dimension has been measured by three

indicators. We fist considered the rural dimension, measuring the relevance of the farming system

associated with each product on the territory. Therefore, we have measured the number of pig farms

involved in the supply chain as a percentage of total farms with livestock in the territory.

Unfortunately, this data was only available for Cinta Senese PDO and Parma Ham PDO

supply chain, since no precise data or information is available on the farming system supplying the

generic non-PDO ham production.

The production chain of Parma Ham PDO involves 4,199 breeding farms located in ten

Italian regions. The pigs bred in these farms were approximately 8 million in 2013 (IPQ, 2014)1.

However, 70% of these farms are located in only ten provinces within four Italian Regions

(Lombardia, Emilia-Romagna, Piedmont and Veneto), where 78% of the pigs are bred (Annex Table

A1). On the other hand, the Cinta Senese production represents a small quota of the overall pig

production in Tuscany. In fact only 81 pig farms are at the moment enrolled in the Cinta Senese

Consortium (INEQ, 2014) and about 100-150 farms are breeding Cinta Senese pigs (Annex Table

A2). The average size of the pig farms is much lower in the Cinta Senese PDO supply chain

(average value of 46 pigs per farm, Annex Table A2), than in the Parma Ham PDO one (average

value of 1,922 pigs per farm holding, Annex Table A1). These figures depict a completely different

picture between these two supply chains: on the one hand, the Parma Ham PDO chain is mainly

based on an industrial livestock production and an intensive animal farming, whereas the Cinta

Senese PDO chain is mostly based on extensive livestock farming systems.

Figure 1 shows that the percentage of farms with pigs on total farms with livestock on the

territories (i.e. Italian provinces, NUTS 3 level) is much higher within the Parma Ham PDO supply

chain (the blue bars) than for the Cinta Senese PDO one (the green ones).

1 It has to be considered that these pigs are supplying not only the Parma Ham PDO producers, but also those of the

main other Italian PDO hams (i.e., San Daniele Ham PDO, Modena Ham PDO, Toscano Ham PDO, etc.).


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Figure 5.6: Indicator "Association of product with territory - Pig breeding importance", Pig farms on total farms with livestock within the territory (%) by territorial unit (Italian provinces, NUTS 3).

Note: Cinta Senese PDO provinces are displayed in green colour, Parma Ham PDO provinces in blue.

Source: our elaborations on data of the 2010 Agriculture Census (ISTAT, 2010), INEQ (2014) and IPQ

(2014).

On average, the score for the Parma Ham PDO supply chain shows that 9.7% of farms with

livestock on the considered territory2 are breeding pigs within the PDO system (Table 2);

nevertheless, some provinces score higher than this average value (e.g., Lodi 26%, Cremona 21%,

Mantova 17.5%).

In Tuscany the average score shows that only a very small share of farms with livestock is

breeding Cinta Senese PDO pigs (0.8%), with only a peak in the Siena province (3.3%) (Table 2).

2 This is the average value of the first ten provinces within the PDO system in terms of pigs bred (i.e., Brescia,

Mantova, Cremona, Cuneo, Lodi, Reggio Emilia, Bergamo, Pavia, Modena and Verona).

0,4%

1,1%

0,6%

0,5%

0,1%

0,8%

0,2%

1,0%

3,3%

0,0%

0,8%

9,9%

17,5%

21,0%

9,1%

25,9%

11,2%

2,9%

9,7%

8,6%

4,0%

9,7%

0,0% 5,0% 10,0% 15,0% 20,0% 25,0% 30,0%

Arezzo

Firenze

Grosseto

Livorno

Lucca

Pisa

Pistoia

Prato

Siena

Massa-Carrara

Cinta Senese PDO

Brescia

Mantova

Cremona

Cuneo

Lodi

Reggio Emilia

Bergamo

Pavia

Modena

Verona

Parma Ham PDO


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Table 5.5: Indicator “Association of product with territory - Pig breeding importance” measured aspig farms on total farms with livestock in the territory (average value, %)

Supply chain Name Value Notes

Global Generic cured ham Not available Foreign production

Regional Parma Ham PDO 9.7% Average value of the 10 more relevant provinces

Local Cinta Senese PDO 0.8% Average value of all provinces in Tuscany

Source: our elaborations on data of the 2010 Agriculture Census (ISTAT, 2010), INEQ (2014) and IPQ (2014).

We have then considered the industrial dimension of the “Association of the product with

territory” indicator by measuring the relevance of the ham processing system associated with each

product on the territory (Indicator "Association of product with territory - Pig meat processing

importance"). Therefore, we have measured the number of pig meat processing industries involved

in the supply chain as a percentage of total food industry in the territory. This index shows the

relative importance of pig processing industries involved in the supply chain on total food industry.

This data was available for the three considered supply chains.

The production chain of Parma Ham PDO involves 150 processors (ham producers) within

the Parma province, that have produced approximately 9 million hams in 2013. According to the

estimations made by Giacomini et al. (2013a), the generic non-PDO ham producers, within the

same territory, are 190 and are producing around 15 million hams every year. The Cinta Senese

PDO processors within the traditional territory are 27..

Table 5.6 shows that the percentage of pig meat processing industries on total food industry

on the territories is quite relevant for the global chain (15.7%) and for the regional one (12.4%),

whilst is almost non significant for the local chain (0.7%). These data show the importance of the

pig processing industry within the Parma territory, where both generic non-PDO hams and Parma

Hams PDO are produced. This has been also demonstrated by other authors showing a high level of

specialization in the territory, also in terms of employment in the meat sector on total manufacturing

within the Parma territory (Giacomini et al. 2013b). On the other hand, these data show the almost

non-significant role of the pig meat processing industry within the Tuscany territory (traditional

territory of the Cinta Senese PDO), if compared to other food sectors.


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Table 5.6: Indicator “Association of product with territory - Pig meat processing importance”, measured as pig meat processing industries on total food industry in the territory (average value, %).


Global Generic cured ham 15.7% Based on estimates made by Giacomini et al (2013a)

Regional Parma Ham PDO 12.4%

Local Cinta Senese PDO 0.7% Average value of all provinces in Tuscany

Source: our elaborations on data of the 2011 Industry and Services Census (ISTAT, 2011), INEQ (2014), IPQ

(2014) and Giacomini et al (2013a).

Finally, we have considered whether there is a link between the origin of raw material (e.g.,

fresh meat, feed) and the territory. This is measured with an ordinal scale based on qualitative

evaluations considering the specific chain's features and the product specification applied.

The case of the generic non-PDO hams chain shows a very weak territorial embeddedness,

since genetics, pigs, feeds and raw legs come from all Europe and are only processed in the local

production system of the Parma Ham PDO. This suggests a weak link of raw materials with the

territory.

For the Parma Ham PDO chain genetics, pigs and row legs come from other 10 Italian

regions, and feed are purchased from different sources, included a large share of imports (e.g.,

soybean). Only the processing phase of hams is made within the traditional Parma territory.

Therefore, we can conclude indicating in this case an intermediate link of raw materials with the

territory.

In the Cinta Senese PDO chain most of the inputs come from the region giving it a strictly

rural dimension. This is especially true for the genetic material pigs and for feeds which, according

to the product specification, have to be produced at least for 60% in Tuscany. Moreover, for this

supply chain all the territorial dimensions are embedded in the local food chain: from the

production of inputs to the consumption in local restaurant or local outlets. This shows a strong link

of the supply chain with the territory.

Table 5.7: Indicator “Association of product with territory” – Origin of raw materials “Is there a link between the origin of raw material (e.g. fresh meat, feed) and the territory?”.


Global Generic cured ham Level 3 (weak link) No limits to the origin of raw material

Regional Parma Ham PDO Level 2 (intermediate link) Fresh meat from delimited area

Local Cinta Senese PDO Level 1 (strong link) Fresh meat and feed from delimited area

* Ordinal scale: level 1 (strong link with the territory), level 2 (intermediate link), and level 3 (weak link with the

territory).



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5.4.1. Indicator “Social cohesion and conviviality”

The “Social cohesion and conviviality” dimension has been measured with two indicators.

We fist considered the number and type of socio-cultural events favoured by the chain in the

territory and then the number of visitors in these socio-cultural events in the territory. These

cultural events organized around products representing a region, link together traditions, culture and

gastronomic itineraries.

We couldn't retrieve any socio-cultural event linked to the global chain, i.e. the generic cured

ham.

At least two main events have been found for the Parma Ham PDO case: the "Festival del

Prosciutto di Parma" ("Parma Ham Festival") and the "Finestre Aperte" ("Open Windows") events.

These two events are directly organised and sponsored by the Parma Ham PDO Consortium. The

"Parma Ham Festival" presents a full calendar of events dedicated to gastronomy, entertainment and

culture organized in the 13 municipalities within the traditional area of production of Parma Ham.

According to the Parma Ham Consortium, about 70,000 people have participated in this event in

2013. Over 6,000 visitors have joined the “Open Windows” event where they could attend the

processing of Parma Hams in selected ham factories.

In Tuscany there are a number of festivals and fairs (named “sagre”) which focus on Cinta

Senese as main product. We counted at least seven small town festivals that refers explicitly to

Cinta Senese in their denomination3, but there are many others festivals and fairs where Cinta

Senese products play an important role. However, it is impossible to determine the exact number of

these events, since there is no an official census. These events are often organized by local

communities (e.g., non-profit associations of citizens), mainly in small towns and mainly in the

Siena province. In many cases, these small-scale events are capable of attracting only few hundred

of visitors, mostly local people and tourists.

Table 5.8 Indicator “Social cohesion and conviviality” – Number of events measured as “Number of socio-cultural events in the territory”.


Global Generic cured ham 0

Regional Parma Ham PDO 2 " Parma Ham Festival " and " Open Windows "

Local Cinta Senese PDO 10 Small town festivals managed by local communities

Source: our elaborations on Consortium data and other local sources.

3 The festivals explicitly focused on the Cinta Senese are: Sagra della Cinta Senese e del Maiale Brado - San Casciano

dei Bagni (Siena), Sagra della Cinta Senese a Celle sul Rigo (Siena), Sagra della Cinta Senese e maiale brado (San Casciano dei Bagni), Sagra della Cinta Senese – Ville di Corsano, Sagra dello Stringozzo alla Cinta – Buti (Pisa), Sagra del Maiale Cinto a Casole D'Elsa (Siena).


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Table 5.9 Indicator “Social cohesion and conviviality” – Number of visitors measured as Number of visitors in socio-cultural events in the territory”.


Global Generic cured ham 0

Regional Parma Ham PDO 76,000 Approximate number of participants

Local Cinta Senese PDO 6,000 Few hundred visitors for each festival

Source: our elaborations on Consortium data and other local sources.

Finally, two indicators were used to assess the “Links with local touristic activities”. We first

considered whether there is a Gourmet Food and Wine Route involved in the territory related with

the food chain, and then we assessed the percentage of farms within the territory involved in on-

farm touristic activities, such as agri-tourism, food tasting, etc.

There is no Gourmet Food and Wine Route dedicated to the global generic non-PDO cured

ham.

The Parma Ham product has a dedicated Gourmet Food and Wine Route named “Strada del

Prosciutto e dei Vini dei Colli di Parma” (“Road of Ham and Wines of Parma Hills”) involved in the

circuit “The Roads of Wines and Flavours” of the Emilia-Romagna region4. This itinerary covers

the low hills crossed by vineyards and the foothills of the Apennines in the Southern part of the

Parma province. The Road of Ham and Wine of the Parma Hills offers five different routes of taste

among art, culture, nature and local products. For instance, in Langhirano, the center of the cured

ham district, it is also possible to visit the Museum of Parma Ham and Charcuterie. Several castles,

fortresses and strongholds of the ancient Duchy of Parma and Piacenza can also be visited on the

route combining in this way the pleasure of food with art and history.

In Tuscany there is a system of “Tuscan wine routes”, defined as “itineraries for the

enjoyment of the wine, olive oil and good food of Tuscany” which are recognized by a Regional

Law as integrated touristic local systems focused on a typical wine and/or other agri-food typical

products5. There are 22 Gourmet Food and Wine Routes recognized in Tuscany. Even if there is not

any typical product route focused on the Cinta Senese meat and salami, these products are an

important part of the basket of goods promoted by many of these Routes, explicitly recalled in the

basket of goods of 5 out of the 22 wine routes. The symbolic value that the Cinta Senese has for

Tuscany is evidenced, for example, by the silhouette of an animal of this breed that has been

adopted as emblem of the typical products of Tuscany in the recent edition of the “Salone del Gusto

– Terra Madre”, organized by Slow Food.

4 The Roads of Wines and Flavours of Emilia Romagna: see http://strade.emilia-romagna.it/web/.

5 The Wine Roads of Tuscany Federation: see http://www.stradevinoditoscana.it/.

http://strade.emilia-romagna.it/web/

http://www.stradevinoditoscana.it/


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Table 5.10: Indicator “Links with local touristic activities” – Gourmet and Wine Route measured by “Is there a Gourmet Food and Wine Route involved?”.


Global Generic cured ham 0 (No)

Regional Parma Ham PDO 1 (Yes)

Local Cinta Senese PDO 1 (Yes)

Binary scale: 1 = yes, 0 = no.

Source: our elaborations on Consortium data.

Unfortunately, it was not possible to gather data or information about the percentage of

farms of the global chain involved in on-farm touristic activities.

Similarly, very few information is available about the percentage of farms of the Parma Ham

PDO chain involved in on-farm touristic activities. However, as noted before, the Parma Ham PDO

chain is mainly based on intensive animal farming, which is not particularly suited for parallel

touristic activities. Therefore, although some experiences of agri-tourisms managed next to the

heavy pig breeding activities exist, these represent less than 10% of the overall number of breeding

farms.

On the other hand, the rearing of Cinta Senese pigs and in particular the processing of Cinta

meats are very often linked to agri-touristics activities managed inside the same firm (recognized by

a National and Regional Laws) and to other touristic activities managed by members of the family

farm. In fact the extensive rearing method are compatible with on-farm tourism activities, and the

Cinta Senese breed as its products (ham, salami and fresh meat) are important elements of attraction

mainly in the hilly area in the center of Tuscany. In a sample of 57 farms enrolled in the Consortium

of Cinta Senese PDO (out of the total 81 farms), 20 farms manage agri-tourism activities (35%),

and 6 more managed food and wine tasting and/or didactic activities (10%). Thus, we can conclude

that almost half of the Cinta Senese PDO farms are carrying out on-farm diversification activities in

the field of tourism and hospitality.

Table 5.11: Indicator “Links with local touristic activities - On-farm touristic activities”, measured as % of farms involved in on-farm touristic activities (agri-tourism, food tasting, etc.).


Global Generic cured ham Not available Foreign production

Regional Parma Ham PDO Level 3 (less than 10%)

Local Cinta Senese PDO Level 1 (more than 40%)

* Ordinal scale: level 1 (more than 40%), level 2 (from 10% - 40%), level 3 (less than 10%).

Source: our elaborations on Consortium data and personal interviews with key stakeholders.


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5.4.2. Concluding remarks

The attribute territoriality can take different forms and specificity in relation to the structure

of the supply chain which directly influences some specific territorial elements. These have been

shown by the seven indicators that we have considered (Figure 2).

In the case of chains completely embedded in the territories (as is Cinta Senese PDO), most

of the inputs (especially genetic material pigs and feeds – which have to be produced at least for

60% in Tuscany) come from the region of origin denoting a strong link with the territory. Although

the Cinta Senese pig breeding and processing activities are not numerically relevant, as compared to

other traditional food chains in Tuscany (e.g., olive oil, wines, cheese, beef, etc.), they represent a

niche produce which is part of a strictly rural dimension. Thus, the “quality concept” is not only

referred to the product characteristics, but consider also all the territorial dimensions that are

included in the local food chain: from the production of inputs to the consumption in local

restaurant or local outlets. The economic agents who benefit from this system are all the actors of

the food chain: pig farmers, local trader, local butchers, local restaurants and local food shops.

Figure 5.6: Difference of performance of local, regional/intermediate, global chains for “Territoriality” attribute.

Note: all the measurement indicators have been linearly transformed on a 0-100 scale.


99

In case of chains that are partially embedded in the territory, as is Parma Ham PDO,

genetics, pigs and row legs come from other 10 Italian Regions. The product specification oblige

PDO producers to process the hams within the traditional Parma territory. The specificities of this

latter are set in the local environment characteristics, in the skills of workers in the ham curing

phase and in the ability of PDO ham processing industries to develop efficient strategies in the

marketing, individually or collectively. The economic agents that benefit from this system are

mainly PDO ham companies and others companies which offer services to them (specific technical

operations and logistics). The quantitative indicators combined demonstrate a high level of

concentration and specialization of companies involved in the pork industry in the Parma territory,

as also reported in other studies demonstrating the industrial district of Parma province (O’Reilly et

al., 2003; Dentoni et al., 2012; Giacomini et al., 2013a, 2013b). Similarly, the farming stage is often

based on an industrial livestock production and an intensive animal farming in the related

territories. Others economic agents, as those involved in Gourmet Food and Wine Routes, benefit

only indirectly from the efficiency of the PDO market and from reputation that PDO ham generate

on the territory.

The global generic cured ham represents a chain not at all embedded in the territory;

genetics, pigs and row legs come from all Europe and are processed in the local production system

of the PDO Parma Ham. The global chain takes advantage from the externalities of the Parma Ham

PDO system. Their producers are mostly the same that are producing the PDO Hams and their

strategies is to maximize the production capacity of their technical structures simultaneously

following a strategy of scale and scope (Dentoni et al., 2012; Giacomini et al., 2013a). Who benefits

from this specific chains are the global ham producers and the service companies which contribute

to improve the efficiency of plant structures. Local pig farmers and economic agents involved in

quality routes can have a negative feedback both in economic terms and in loss of reputation of the

territory. By the contrary, the entire region can benefit only for the economic growth that the

combination of PDO and global chains can generate in economic terms.

5.5. Resources use and pollution

5.5.1. Results

Three supply chains producing cured ham have been analysed comparing the global supply

chains with local ones. In particular it concerns the production of generic global cured ham, PDO

Parma Ham and the local supply chain of the Cinta Senese ham.

Several studies concerning the environmenal impact of pigmeat supply chains have been

carried out in the recent years. Williams et all (2006) have analyzed the environmental impact of

pig meat in terms of tons of slaughter weight of four different supply chains: heavy pigs, indoor and

outdoor breeding and conventional light pigs: GWP (Global Warning Potential) ranges from 6,080-

6,420 kg CO2-eq/t slaughter weight, nutrients or eutrophication potential 95-119 kg PO4-eq t

slaughter weight, land use 6900-7500 m2/ t and 15.5-16.7 MJ/ t.


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In an other study Basset-Mens and Van der Werf (2005) use live weight as denominator

instead of slaughter weight and obtain a GWP in a range of 2.3-3.5 kg CO2-eq/kg live weight,

nutrients 0.021-0.017 kg PO4-eq/kg, 5.4-6.3 m2 of land occupation/kg and an energy consumption

of 16-18 MJ/kg.

Also Blonk et al (1997) use as functional unit the pig live weight obtaining the follows

results: GWP 3.7 kg CO2-eq/ kg live weight, nutrients 0.018 kg PO4-eq/kg and energy

consumption 16 MJ/ kg.

Zhu-XueQin and Van Ierland (2004) adopted a different functional unit: t of protein and

obtain in a conventional breeding system 2.3 kg CO2-eq/ t protein, 2,491 N-eq (eutrophication),

land use 55 m2/t protein and energy consumption 397,252 MJ/t protein.

In a more recent Danish study Nguyen et al (2011) obtain: 3.1-3.4 kg CO2-eq/ kg of pork

delivered by the slaughterhouse.

J.Y. Dourmad et al (2014) in a study on evaluating environmental impact of contrasting pig

farming system they obtained for GWP values between 2.3-3.5 kg CO2-eq/kg live weight, nutrient:

0.016-0.034 kg PO4-eq /kg LW, CED 16-24 MJ/kg LW, land use 4.1-10.6 m2/kg LW.

It must considered that it is very risky to compare directly different LCA studies as different

functional units are used, different inputs, different methods and different allocations systems. So

the data reported should not be compared with the results of the present study, but they can serve

just to have an indication of the range of the impacts achieved.

In this study the environmental impacts of cured ham production have been calculated:

breeding, slaughtering, seasoning and retailing of the three chains: Generic cured ham, Parma Ham,

Cinta Senese ham. The first two chains are fully realised and analysed in Italy. In the third supply

chain (generic) the fresh hams are imported from the Netherlands and for the phase of breeding and

slaughtering we have used data from a CML Dutch study.

We have studied all the impacts generated throughout the various phases of production of

the ham, from the breeding phase to the phase of slaughtering, seasoning and retail.

We have calculate all impacts up to the sales of cured ham in the retail shop. In different

phases of production we have considered the kg of live weight (breeding), the kg of carcass

(slaughterhouse), the kg of cured ham (seasoning) and at the end kg of slice ham (retail).

The impacts are based on the weight of the various products that come out of the different

phased of production. Breeding: we have considered the live weight selecting only the inputs

necessary for the production of the heavy pigs and ignoring all the inputs for other productions.

Slaughterhouse: we have attributed all the impacts to the carcass mass (80% of live pig weight).

Seasoning: we have attributed the impacts considering the fresh ham mass as carcass part (fresh

uncured ham yield is 70% of the ham cut) , for retail we attributed the impact as part of cured ham

really sold and consumed (slice yield is 55% of cured ham).

We calculated the following impacts

- Eutrophication (kg PO4-eq/UF)

- Climate change, carbon foot print (CO2 eq/UF)

- Consumption of fossil energy (MJ/UF)

- Water footprint (m3/UF)


101

- Land use (m2/year/UF)

These five environmental impacts have been calculated with the program SimaPro 8.0.3.; for

the methodological approach and for the inventory phase see annex 1 chapter 13.1.

Livestock phase

The environmental impact of the livestock phase of the three supply chains are reported in

table 5.12 and in figure 5.7 The functional unit used for the breeding phase is 1 kg of pig live

weight at farm gate.

Table 5.12 - Environmental impact of livestock phase

Environmental impacts

Unit/kg L.W.

Cinta Senese pig

Parma pig

Light pig

Eutrophication kg PO4-eq 0.0285 0.0278 0.0249

Carbon foot print kg CO2-eq 3.55 3.92 2.24

Non renewable, fossil MJ 18.10 20.14 17.85

Water footprint m3 H2O 1.93 2.06 2.60

Land use m2/year 9.12 4.85 5.21

Figure 5.7– Comparison of the impacts of the livetsock phase(maximaal 100%)

The livestock phase generates the highest environmental impacts. In particular, the duration

of the fattening period, which differs significantly among the three production chains (about 15

months for the Cinta Senese pig, 9 months for the Parma pig and 6 months for the light pigt)

influences significantly the results. The length of the growing cycle influences all impacts as a

decisive factor for the production efficiency.

Cinta Senese and Parma pigs have a higher eutrophication potential, probably depending on

feed and to a lesser extend due to manure management; in the Cinta Senese pig the manure

deposited by animals during grazing is not managed.

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%

Eutrophication Carbon footprint

Energy demand Water footprint Land use

Livestock (Live weight)

Cinta Senese pig Parma pig Light pig


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From a eutrophication point of view, environmental impact per kg product may not be

sufficient for making a fair decision. Cederberg (2002) suggests that assessment of eutrophication in

animal production systems should be made both per unit product, but also per unit area.

Impact breeding system Unit Cinta Senese pig Parma pig Light pig

Eutrophication g PO4/m2 3.13 5.74 4.77

By dividing the eutrophication for m2 of land occupation we obtain a quantity of PO4 eq,

expressed in grams per m2. In this case we have a different situation where Cinta Senese has the

best results regarding eutrophication.

In the case of greenhouse gas emissions the results between Parma and Cinta Senese is

reversed. The breeding of the heavy Parma pigs requires a higher energy consumption then in the

case of the Cinta Senese pig that also takes advantage of the resources of the forests. The much

lower GHG emissions of the Dutch pigs are explained by the shorter length of the of the production

cycle.

For the energy demand impact category the Cinta Senese pig is approximately equal to the

light pigs in the Netherlands, while the Parma pig has the highest impact, but in comparison to the

other impacts the differences are less evident.

Water consumption is higher for the Dutch light pigs, while the Cinta Senese pig has the

lowest values. This depends mainly on the different water requirements of the feeds that make up

the rations.

Land use in Cinta Senese breeding included the pasture area (wood) and therefore it is

higher in the Cinta Senese pig production. This area is quantified taking account of livestock

density laid down in the PDO product specification of the Cinta Senese: 1,500 kg liveweight per

hectare. We have not calculated an allocation between wood and pigs because they are marginal

forests with insignificant timber production. This forest are in fact dedicated to pasture to make it

productive. The small advantage of the Parma pig compared to the light pig can be explained by the

different components of the feed ration: for example in the feed of the light pig tapioca is included,

a crop that has a lower yield/ha compared with other components of the ration.

Slaughterhouse phase

The functional unit at the end of the slaughterhouse phase is 1 kg carcass weight. A 80%

slaughter yield has been hypothesized. Environmental impacts are shown in table 5.13 and in figure

5.8


103

Table 5.13 - Environmental impact of slaughterhouse phases.

Environmental impacts Unit/kg Carcass Cinta Senese pig Parma pig Ligth pig

Eutrophication PO4-eq 0.0360 0.0349 0.0311

Carbon foot print CO2-eq 4.63 5.05 2.86

Non renewabel, fossil MJ-eq 27.74 27.82 23.51

Water footprint H2O m3 2.45 2.71 3.24

Land use m2/year 11.48 6.13 6.52

Figure 5.6.1.2.1 – Comparison of the impacts of the slaughterhouse phase (maximaal 100%)

The results after the slaughter phase reflect the results already obtained for the livestock

phase except for the consumption of fossil energy equivalent where the Cinta Senese pigs equal the

values of Parma pigs. In fact slaughtering of the Cinta Senese pigs takes place in small local

slaughterhouses that are usually less energy efficient.

In the following graphs are showed the different impacts, after breeding and slaughterhouse

phases, divided by feed, on farm and slaughterhouse.

The impacts derived mainly from the feed production from in all the cases.

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%



Slaughterhouse (carcass)

Cinta Senese Parma Generic


104

When the feed is produced, there are environmental impacts from the fields, the processing and

transport. The slaughter and the “On farm” stages are less significant, but the impacts from feed

production can be seen to have a far greater impact.

0,00

1,00

2,00

3,00

4,00

Cinta pig Parma pig Light pig

GWP kg CO2/kg carcass

Feed On Farm Slaughterhouse

0,00

0,01

0,02

0,03

0,04


Eutrophication kg PO4/kg carcass


0,00

5,00

10,00

15,00

20,00

25,00


CED MJ/kg carcass


0,00

2,00

4,00

6,00

8,00

10,00

12,00


LU m2/year/kg carcass


0,00

1,00

2,00

3,00

4,00


WSI mc/kg carcass



105

Seasoning phase

The functional unit after the seasoning phase is 1 kg ham weight. A 70% cured ham yield

has been hypothesized. Environmental impacts are shown in table 5.14 and figure 5.9

Table 5.14- Environmental impact of seasoning phases.

Environmental impacts Unit/kg Ham Cinta Senese Parma Generic

Eutrophication PO4-eq 0.0525 0.0511 0.0457

Carbon foot print CO2-eq 7.68 8.56 5.41

Non renewabel, fossil MJ-eq 54.25 64.56 56.94

Water footprint H2O m3 4.89 5.48 6.07

Land use m2/year 16.49 8.85 9.40

Figure 5.9 – Comparison of the impacts of the seasoning phase (maximum is 100%)

The consumption of fossil energy equivalent returns higher in the Parma pig. The generic

cured ham and the Cinta Senese ham have a production process with a much shorter maturation

period than the Parma Ham (from a minimum of 6 months to a maximum of 12 months). This factor

determines a longer stay of the hams in the various seasoning cells.

The Cinta Senese energy demand impact ham is slightly lower than the light pig ham due to

the transport (from the Netherland to Italy) of the fresh thighs at the sausage company.

Retail phase

The functional unit in the retail phase is 1 kg of edible slice of ham. The average yield from

the whole ham to ham slice is very low: 55%. Environmental impacts are shown in table 5.15 and in

figure 5.10

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%



Seasoning (ham)

Cinta Parma Generic


106

Table 5.15- Environmental impact of retail phases.

Environmental impacts

Unit/kg slice ham

Cinta Senese Parma Generic

Eutrophication kg PO4-eq 0.0956 0.0931 0.0831

Carbon foot print kg CO2-eq 14.01 15.71 9.91

Non renewable, fossil MJ 99.35 119.54 104.70

Water footprint m3 H2O 8.91 10.03 11.06

Land use m2/year 29.99 16.09 17.10

Figure 5.10 – Comparison of the impacts of the retail phase (maximum 100%)

The results after this last step reflect the data obtained in the livetsock phase except for the

consumption of fossil energy which is higher for the slice of ham of the generic light pig than in

that of the Cinta Senese pig (less transport operations).

Impact in different phases

In the following graphs (Figure 5.11, 5.12, 5.13) the share of the different impacts at the

different production phases is shown.

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%



Retail (slice ham)

Cinta Parma Generic


107

Figure 5.11 – Parma: comparisons of the different phases.

Figure 5.12 – Cinta Senes: comparisons of the different phases.

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%

PO4-eq CO2-eq MJ-eq H2O m3 m2/year

Parma

Livestock Slaughterhouse Seasonig Retail

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%


Cinta Senese



108

Figure 5.13– Generic : comparisons of the different phases.

In all cases the livestock phase is predominant in the eutrophication and land use impacts.

Fote the livestock phase most relevant are eutrophication, the carbon foot print, the water foot print

impacts and land use. The seasoning phase instead is very important for energy use.

The phase of slaughter is relatively high for the Cinta Senese pig due to the small size of the

local slaughterhouses.

5.5.2. Conclusion

A first important difference between the Cinta Senese, Parma Ham and Generic Ham chain

regards the age at slaughtering of the pigs and hence the length of the period they live on the farm.

In the Dutch cases the pigs are slaughtered at 6 months, while the Italian Cinta Senese pigs are

slaughtered at about 15 months and the Parma pigs at least 9 months. As shown by the results of the

LCA the feed given to the pigs has the major impact on the differences. Furthermore, if pigs are

kept longer on the farm (i.e. the daily growth is lower) more feed will be administered per kg of

meat.

Another difference concerns how the pigs are housed. Pigs can be housed in stables as in pig farms

of the Generic Cured Ham and Parma Ham chain. Pigs can however also be kept outdoors as is the

case of the Italian Cinta Senese pigs that live outdoor and in the forests. This influences land use,

feed and manure management.

Production efficiency, the energy intensity and the input of technical resources are crucial in

the determining the emissions: with the same technical inputs, a higher productive performance

permits to get significant reductions in emissions, because these are diluted on larger quantities of

product. When we look at the subsequent phases of further processing of the ham only the

0,0%

20,0%

40,0%

60,0%

80,0%

100,0%

120,0%


Generic



109

seasoning phase has a significant impact on the carbon footprint, the consumption of energy and the

water footprint.

Drawing up a kind sort of ranking starting from lowest impacts we have:

Eutrophication (by unit product): 1 Generic ham, 2 Parma, 3 Cinta Senese

Eutrophication (by unit area): 1 Cinta Senese 2 Generic ham, 3 Parma.

Climate change: 1 Generic ham, 2 Cinta Senese, 3 Parma

Cumulate energy demand: 1 Cinta Senese, 2 Generic ham, 3 Parma

Water footprint: 1 Cinta Senese, 2 Generic ham, 3 Parma

Land use: 1 Parma, 2 Generic ham, 3 Cinta

The generic cured ham supply chain has the lowest environmental impact in terms of eutrophication

and contribution to climate change, the local Cinta Senese pig chain is the best in saving water and

use of energy and in the calculation by unit area, while the Parma Ham chain is the one that has the

lowest land use. About the eutrophication if this impacts is calculated per unit area and not per

product unit the Cinta Senese breeding get the best result.

The extensive livestock production like that of the the Cinta Senese occupies a larger area of

land, but on the contrary allows for higher water savings and less consumption of fossil resources.

The intensive livestock production (Parma pig and light pig) has usually better performances with

benefits in the climate change, land use and eutrophication impacts.

5.6. Affordability

Indicator “Cured ham consumption”

The price level that the product has for the final consumer is related to various conditions

and factors influencing the value chain from farm to fork. The dynamics in pork meat consumption

in Italy during the last decade is shown in Figure 5.14 In the considered period, the overall pork

meat consumption increased by 8%, from 2,259 thousand tons in 2003 to 2,442 thousand tons in

2013. The per-capita apparent pork meat consumption in Italy ranges from a minimum of 38

kg/person to a maximum of 42 kg/person (average value 40.2 kg/person).

Figure 5.14 Dynamics in pork consumption in Italy, overall (.000 tons) and per-capita consumption (kg/person).


110

Source: our elaborations on ISTAT and Eurostat data.

The main dynamics in Parma Ham PDO and generic ham consumption from 2007 to 2013

are shown in Figure 5.14. The consumption of Parma Ham PDO in Italy steadily stands upon the

consumption of generic cured ham. However, it is quite evident that the gap between the

consumption of the two products is variable, ranging from a maximum of 6,700 thousand tons in

2009 to a minimum of 4,700 tons in 2013. In fact, the Parma Ham PDO consumption declined by

5% since 2009, while generic ham consumption increased by 1% in the same period. Overall, the

consumption of generic ham seems more stable than the consumption of Parma Ham PDO.

The production of Cinta Senese cured ham is very limited, due to difficult production

conditions and limited profitability. The production under PDO is even lower, because of strict rules

on feeding and production and of related costs. Recall that the Cinta Senese PDO protects meat and

not processed products, but Consortium developed a collective mark assuring consumers that fresh

ham are PDO certified.

There are not available data on Cinta Senese pork ham and salami consumption. Ham

consumption can be estimated from the number of slaughtered certified PDO. On average in 2009-

2012 3.539 PDO pigs were slaughtered, and about 7.000 cured hams produced. The average weight

of a Cinta Senese cured ham is about 8 – 9 kilos (bone included). Therefore, it is possible to

estimate a Cinta Senese PDO ham annual production and consumption of approximately 600 q (60

tons).

The average consumption of Parma Ham PDO is approximately 32 thousand tons, while the

average consumption of generic cured ham is about 26.6 thousand tons.

Figure 5.15 Dynamics in pork consumption in Italy – domestic market Parma Ham and generic ham


111

Source: our elaborations on Parma Ham Consortium, Nielsen data.

Table 5.16: Cinta Senese estimated production and consumption

2009 2010 2011 2012

PDO certified heads 3,452 3,386 3,454 3,862

PDO ham Certified production (kg) 435,376 434,605 464,247 494,228

Hams produced (n.) 6,904 6,772 6,908 7,724

Estimated PDO cured hams (kg) 58,684 57,562 58,718 65,654

Source: our elaborations on Cinta Senese Consortium data.

Table 5.17: Indicator “Cured ham consumption”, tons.


Global Generic cured ham 26.619 National representative retail survey (Nielsen data)

Regional Parma Ham PDO 32.097 National representative retail survey (Nielsen data)

Local Cinta Senese PDO 60 Estimated on the basis of production data

Source: our elaborations on Parma Ham Consortium, Cinta Senese Consortium, Nielsen data.

Indicator “Retail price in supermarket”

Local food products are often perceived as more expensive than those provided through

global supply chains. Figure 5.16 shows the average retail price in Italy of the Parma Ham PDO and

generic cured ham. The dynamics reveal a higher average price of the Parma Ham PDO (on average

24.4 €/kg) and a lower price of the global generic cured ham (average price 18.2 €/kg).

31.47132.037

32.88132.130

32.83732.156

31.168

27.03726.530 26.155 26.527 26.884 26.765 26.437

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

20.000

25.000

30.000

35.000

2007 2008 2009 2010 2011 2012 2013

Ton

s (g

ap

)

Ton

s (o

vera

ll c

on

sum

pti

on

)

Dynamics in pork consumption - domestic market

Consumption gap PDO Parma ham Generic cured ham


112

In this case, as also argued by Giacomini et al. (2013a), the global chain (i.e. the generic

ham chain) seems more competitive because of a higher flexibility in the procurement of less

expensive raw material (i.e. fresh hams), mostly imported (e.g., from Northern European countries

like Germany and the Netherlands), and because of a shorter curing period and financial cycle, as

well as absence of certification costs. Moreover, the larger companies involved in the production of

generic hams achieve scale economies more than the Parma Ham PDO producers (Dentoni et al.

2012; Giacomini et al. 2013a), which allows global food chains to offer lower and more stable

prices.

It is also evident that the price gap between the two product is declining, from 7.1 €/kg in

2009 to 5.3 €/kg in 2013. It can be presumed that, as also shown by Figure 5.16, demand switched

to the less expansive generic ham, which indeed experienced a more steady demand, strengthening

firms’ interest in a product positioned in a lower price band (Giacomini et al. 2013a). From these

considerations, the global food chain is more efficient and hence better at cutting down raw material

costs in order to provide affordable prices to consumers.

Figure 5.16: Retail price in Italy, Parma Ham PDO and generic ham, domestic market (€/kg).

Source: our elaborations on Parma Ham Consortium, Nielsen data.

Due to its limited production and very high production costs, the Cinta Senese ham is not an

everyday product, so it is hardly comparable with the other cured hams. The price of Cinta Senese

ham is variable according to different marketing channels and selling types. The most expensive is

the pre-sliced ham packaged in controlled atmosphere, sold in supermarkets at a price between 120

and 140 €/kg (increasing trend). Sliced Cinta Senese ham (not pre-packed) is sold in supermarkets

(not very common) or gourmet groceries at a prices between 65 and 75 €/kg. Marketing of vacuum

packaged pieces of ham or of whole hams is not very common. In these cases the price takes in

account the non edible parts (25% of the total weight). In these cases the price may drop to 35 €/kg


113

for hams sold directly on-farm. Therefore an average retail price of 70 €/kg can be estimated for the

Cinta Senese ham.

Table 5.18: Indicator “Retail price in supermarket”, €/kg.


Global Generic cured ham 18.1 National representative retail survey (Nielsen)

Regional Parma Ham PDO 24.4 National representative retail survey (Nielsen)

Local Cinta Senese PDO 70.0 Based on direct retail observation

Source: our elaborations on Parma Ham Consortium, Nielsen data, direct retail observation.

Indicator “Consumers’ quality perception”

Finally, we have considered the consumers’ quality perception of cured hams of the three

chains in Italy.

Recently, an on-line choice experiment was conducted on a sample of 250 Italian consumers

to test for the relative importance of quality attributes of cured ham, by applying a multinomial logit

model (Capelli et al., 2014). Although its sample was not fully representative of the Italian

population, this study provides several important insights on consumer’s quality perception of

Parma Ham PDO and generic non-PDO cured ham. In particular, the survey has shown a higher

quality perception of the Parma Ham PDO as compared to the generic non-PDO ham. In particular,

it was estimated that consumers in general are willing to pay and average 5.0 €/kg extra for the

PDO labelled Parma Ham compared to the product without quality signals. This result is similar to

the retail price gap shown in Figure 5.16. However, the study shows that consumers would

appreciate an enhanced quality strategy by the Parma Ham PDO Consortium, for instance by means

of a “High Quality – PDO label”; it was estimated that consumers would be willing to pay an extra

9.7 €/kg for the high quality PDO label compared to the generic non-PDO ham. These results

suggest a low quality perception by consumers for the generic cured hams and an intermediate

quality perception for the Parma Ham PDO.

Although no surveys or experimental studies are available on the consumers’ quality

perception and WTP for Cinta Senese PDO ham, we can argue from key stakeholders and experts

interviews that the Cinta Senese PDO ham, mostly sold in local markets and restaurants, is

perceived by consumers as a top quality product. This also justifies the extremely high market price

of the product.


114

Table 5.19: Indicator “Consumers’ perception”.


Global Generic cured ham 3 Based on secondary data (Capelli et al., 2014)

Regional Parma Ham PDO 2 Based on secondary data (Capelli et al., 2014)

Local Cinta Senese PDO 1 Based on secondary data (interviews)

* Ordinal scale: level 1 (high quality perception), level 2 (intermediate quality perception), and level 3 (low

quality perception).

Source: our elaborations on interviews and secondary data (Capelli et al., 2014).

Concluding remarks

It is quite evident that the global food chain is more efficient and hence better at cutting

down raw material costs in order to provide affordable prices to consumers. This is also shown by

the quantity of generic cured hams consumed in Italy which, from 2009 to 2013, has increased by

1% whereas the Parma Ham PDO consumption declined by 5% in the same period. In this way, the

gap between the consumption of the two products has gradually declined to the minimum of 4,700

tons in 2013.

On the other hand, the Cinta Senese PDO ham is hardly comparable from this point of view

with the other cured hams since, while carrying features of superior quality, it is sold on the market

at extremely high price; therefore it is not affordable for all consumers, especially for low income

consumers.

Figure 5.17: Difference of performance of local, regional, global chains for “Affordability” attribute.

Note: all the measurement indicators have been linearly transformed on a 0-100 scale (a higher value denotes

a more “affordable” feature).


115

6. Discussion on the research questions

6.1. Global-Local performance comparison (research question 1)

The following table synthezises the results of the comparison with regard to the six attribues

analysed and contains the main conclusions of this study. For each attribute was then given a score,

expressed by researchers on the basis of the mearuse performances on a three-level qualitative

scale, on which was built a radar chart.

In the next steps of the project a participatory evaluation by stakeholders involved in the

three chains is planned.

Table 6.1 Performance profiles of Italian cured ham cases and synthetic evaluation (1: high; 2: intermediate); 3: low)


116

Generic ham (global) Parma PDO (regional) Cinta S. PDO (local)

VALUE ADDED Low value added, large

pig farms and large

companies in cured ham

production. Relatively low

priced product which

competes on the global

relevant market of cured

hams

Average value added is

moderately high both at

farm and industry level.

Allows the coexistence of

small and large processing

companies within the

Parma Ham supply chain

Very high added both at

farm and at processing

industry level which can

be attributed to the market

having typical niche

market characteristics.

Very small volumes with a

very high quality product

meets high income

consumers in Tuscany and

adjacent regions

Value added 3 2 1

RESILIENCE

Lower resilience. High

exposure to risk and low

opportunities for

collaboration between

different phases of the

chain. Disconnected from

public and societal

support.

High resilience, mainly

thanks to ham processing

firms that are the core

actor in the chain,

characterized by a good

adaptation capacity

through learning and

innovation. This

satisfactory level of

resilience is largely

obtained at the expenses of

pig breeders, who seems to

be the weak stage of the

chain. The ability to

mobilize public support is

a relevant feature. Two

interconnected factors

helps chain resilience: the

Product designation of

origin link the product to

the territory to one side

and to consumers on the

other, and the strong

governance system (Parma

Ham consortium) that

helps collaboration

between firms and

interaction with other local

stakeholders.

High resilience in terms of

recovering from shocks

but intermediate in terms

of search for new

equilibria. The

performance is good in

particular in terms of

diversification,

differentiation and

intradiversity of chain

organizational

configurations, allowing

for risk-spreading. This

good performance

originates from a low

dimension and a low level

of specialization of firms,

which on the other side

causes an intermediate

performance in terms of

adaptation capacity and

learning and innovation.

The Product designation of

origin, even if it cover

only the fresh meat, play a

relevant role.

Resilience 3 1 1

CHAIN

GOVERNANCE

Coordination managed

only by chain members

without a formal

intervention of chain

members. High flexibility

and indirect effect on the

Parma PDO chain.

High coordination

activities, mainly thanks to

ham processor firms. They

show a good capacity to

cope with quality

management,

technological innovations,

marketing strategies and

political lobbying to

institutional stakeholders.

Good management activity

especially in the process of

quality construction of the

PDO Product

specifications, but which

refers only to the fresh

meat and not to the cured

ham. Nowadays the supply

chain suffer the action of

new members more


117

This satisfactory level of

chain management

supporting the whole

quality chain.

vacated to market Cinta

senese meat instead the

territory. The system got

the strong support of local

Institutions that consider

this model relevant for the

rural area.

Chain governance 3 1 2

TERRITORIALITY The chain is not embedded

in the territory. Raw

materials om from all

Europe. It takes

advantage from the

positive externalities of

the Parma Ham PDO

system. Risk of loss of

reputation of the

territory. The region can

benefit for the economic

growth (e.g.,

occupation).

The code-of-practice forces PDO producers to

process the hams within

the traditional Parma

territory, but fresh meat

comes from 10 Italian

regions (partially

embedded). High

concentration of pig

meat industry in Parma.

High reputation benefits

other actors (e.g.,

turistic operators

involved in Gourmet

Food and Wine Routes)

The Cinta Senese PDO is

completely embedded in

the territories, since most

of the inputs (including

feeds) come from the

region of origin (Tuscany).

The “quality concept”, in

this case, is not only

referred to the product

characteristics, but

consider also all the

territorial dimensions that

are included in the local

food chain: from the

production of inputs to the

consumption in local

restaurant or local outlets

Territoriality 3 2 1

RESOURCE USE

AND POLLUTION

Because of the higher

efficiency level in pig

production, the shorter life

time of the pigs and the

shorter seasoning period of

hams the generic cured

hams chain has the best

performance related to

eutrophication and carbon

footprint.

The carbon footprint, the

fossil energy consumption

and the water footprint of

the Parma Ham supply

chain are the worst of all

three chains, because of

the lower production

efficiency of heay pigs, the

extensive use of water on

farms and the high

electricity use during the

long seasoning process.

Land use instead is the

lowest in the Parma chain

The Cinta Senese supply

chain has the lowest

consumption of fossil

energy and water, but the

highest use of land. The

carbon footprint is better

than in the Parma chain

because of the shorter

seasoning period of the

hams, but the level of

eutrophication is the worst

of all three supply chains

Resource use and

pollution

2 3 1

AFFORDABILITY The global chain is more

efficient and hence

better at cutting down

raw material costs in

order to provide

affordable prices to

consumers. Low quality

perception of

consumers, but lower

prices as compared to

The regional is inbetween

in providing hams at

prices higher than generic

cured ham (+34%) but at

higher perceived quality.

However, these high

prices are moving

consumption from Parma

Ham to generic hams.

The local chain is hardly

comparable from this

point of view with the

other cured hams since,

while carrying features

of superior quality, it is

sold on the market at

extremely high price;

therefore it is not

affordable for all


118

Parma Ham. consumers, especially

for low income

consumers. Affordability 1 2 3

Figure 6.1.Overall evaluation of attributes for local, regional and global supply chain

The comparison of the three cured ham supply chains highlights the very low performance

of the global ham supply chain, which is the worst one for all the 6 attirbutes excluded Affordability

(1st position) and Resource use and pollution (2nd position). The globalization of the production

process allows for a control of costs, obtained by means of economies of scale and not (only) by

means of the worsening of environmental impcts of production, which anyway remain critical. At

the local level of the processing phase (the Italian province of Parma and neighbouring provinces,

trhe delolcalisation of super-intensive pig farming allows for an improvement of environmental

impacts resulting in a greater social acceptability. The low level of value added per Kg is partly

compensated by the large scale of production and processing. The low level of resilience is perhaps

the most cirtical issue, even if some big processing enterprises operate on both generic ham and

PDO Parma ham chains, obtaining in this way a good level of resilience at the enterprise level.

On the other side there is the local chain, the Cinta senese PDP one, that seems to have the

better performance. The low level of affordability is inherent to the identity of the product itself; at

the same time is thanks to the high prices of the cured ham that it is possible to create an high value

added and to remunerate actors involved a production process able to preserve a traditional, low-

0

20

40

60

80

100Value added

Resilience

Chain governance

Territoriality

Resource use and pollution

Affordablity



119

productivity breed, and to respect the environment in terms of low animal densities per hectare. The

Cinta senese is a good example of the “virtuous economic model” of origin-based products

(Vandecandelaere et al, 2010).

The regional Parma ham chain performs in a similar manner to the Cinta Senese one, but

with a bad level of resource and pollution impacts and with a good level of resilience.

6.2. Global-local interactions (research question 3)

Global and local food chains interact at different levels. From our empirical analysis many

points of contact between different logics (global and local) and different chains emerge.This is

particularly clear when we consider resilience. Resilience of the Parma Ham PDO system is based

non only to the strong link with the territory, but also on the existence of strong contact points with

the generic cured ham chain. In fact many Parma Ham firms process both Parma and generic cured

ham. In this way Parma Ham processing firms can work on multiple markets, characterized by

different trends and exposed to different risks. In this time of economic crisis, this allows for some

Parma Ham processors to diversify in a low-price market segment in order to recover the lost sales

in the Parma Ham market (characterized by higher prices).

The Generic Cured ham exploits the image of Parma Ham being the low cost alternative, but

at the same produced primarily in the same production area. This interaction enables the generic

cured ham to be sold at slightly higher prices than when this positive interaction with the territory

would not have taken place,

The implementation of individual and collective strategies allowing for a strong resilience

may involve a transformation of the real identity of the Parma ham supply chain, that can lose some

key features of localness. As a result, global and local logics coexists in the same chain.

The local Cinta Senese chain influences in its turn the Parma Ham chain when some PH

companies invest in small outdoor pig facilities in order to create an image of localness to their

products.

6.3. Methodological reflections (research question 2)

The methodology was based on an integration between quantitative (indicators selection and

measurement) and qualitative (mainly in-depth interviews) approaches, allowing for a better

understanding of the cases.

However, some critical points emerged:


120

- the three products are not perfect substitutes and they are characterized by different ways of

consumption, in particular Cinta senese ham is a speciality food, while Parma and generic hams

are daily products

- the different dimension and level of organization of the three chains entails a different availability

of data. Cinta senese chian is characterized by a higher level of informality

- hybridities between different chians emerges, and inside each chain (Parma, generic and Cinta

Senese hams) there are different models more or less inspired by a local or by a global approach.

The three chains partly overlap

- participatory approaches had a secondary role and was applied only partially. The analysis relied

on qualitative data collection by means of interviews and expert conclustions. Indicators were

identifies thanks to an informed judgment. A very participatory approach ask too much time

compared to that available for this research.

- the choice of indicators was restricted to the indicators available or quickly computable, being

impossible to make long observations. In addition, some indicators should be measured for a long

time in order to observe some supply chain attributes (like resilience)

- the differences in perfomances of the three chains cannot always be attributed directly and

certainly to the global and local character, due to the presence of many “disturbance factors”

impacting on attribute poerfoamnces but not being directly attributable to the local or local

chacaracter of the chains.

- some indicators, like resilience, are multifacetted and complex. In this work resilience was

decomposed in some key aspects, in order to give an empirically-based evaluation. For each of

them one analytical indicator was built. Subsequently, synthetic and cross-cutting indicators were

calculated in order to provide a general overview of the performance of the three chains in terms

of resilience.

- there are interrelationships and contradictions between attributes at sector level (pig farming,

slaughtering, ham processing) and at the whole supply chain level. This is for example the case of

resilience. One sector can gain higher levels of resilience by transferring risks and losses to other

weak sectors of the chain. This seems to be the case of the Parma Ham chain, where ham

processors succeeded in transferring risks to farmers


121

7. Annexes

7.1. Annex 1– Volatility indicators and Analytical indicators results

7.1.1. Prices volatility results

Results are presented according to the four stages:

- Volatility of feed prices (concentrate and other)

- Volatility of live pig prices

- Volatility of fresh ham prices

- Volatility of cured ham prices

V.1 - Feed prices volatility

Feed prices evolution measure a pressure from global markets on the pork system, and they cannot

be interpreted per se as an indicator of system resilience. For Dutch light pigs and Italian heavy pigs

the monthly average price of finishing feed is considered. For Cinta Senese, due to the small market

and to the rule of the PDO Product specification which oblige to feed animals with at least 60% of

feeds from Tuscany, the average price of national feed is not representative; we used instead the

average price on local market of some ingredients for pigs feeding, that is barley, oat, maize and

broad bean.

Trends of feed prices are illustrated in the following graphs. Volatility indexes (coefficients of

variation) shows that the local supply chain is the more exposed to feed volatility, probably due to

the restrictiveness of the regional market, while the less exposed is the global one (Netherlands pigs

production).

Source: CRPA / Interpig

0,00

100,00

200,00

300,00

400,00

500,00

jan

-09

apr-

09

jul-

09

oct

-09

jan

-10

apr-

10

jul-

10

oct

-10

jan

-11

apr-

11

jul-

11

oct

-11

jan

-12

apr-

12

jul-

12

oct

-12

jan

-13

apr-

13

jul-

13

oct

-13

€/t

on

s

Average price of finishing pigs feed

Netherlands Italy


122

Source: Chamber of Commerce of Siena

Volatility Index for feed prices Indicator V.1 Type of chain Volatility

index Years

Notes

Coefficient of variation of

monthly feed prices over 3

years

Generic ham

(global) 0.081 2011-13

Av. price of finishing pigs

feed (concentrates)

Parma PDO

(regional) 0.086 2011-13

Av. price of finishing pigs

feed (concentrates)

Cinta S. PDO (local)

0.099 2011-13

Av. price of representative

agricultural products for feed

Source: our elaboration on CRPA and Chamber of Commerce of Siena

V.2 - Live pigs price volatility

Trends of live pigs prices are illustrated in the following graphs. Data on light pigs are not available

because there is a limited import of live animals from Northern Europe (global chain).

According the interviewed farmers, Cinta Senese actual prices are more differentiated than the

official ones surveyed by the Chamber of Commerce of Siena, depending on the rearing and feeding

systems. Were reported prices up to 4 Euros per kilo for the pigs of better quality.

The volatility (measured by the coefficient of variation, given by the ratio of mean and standard

deviation of the current values of prices) is much lower for Cinta Senese than for Heavy Italian pigs

for the production of Parma PDO, as illustrated by the following table.

Source: Ismea

150

200

250

300ge

n-1

1

mar

mag lu

g

set

no

v

gen

-12

mar

mag lu

g

set

no

v

gen

-13

mar

mag lu

g

set

no

v

€/t

on

n.

Raw materials for Cinta Senese feeding, prices on local market

Maize Oat Barley Broad bean

1,0

1,2

1,4

1,6

1,8

2,0

1 3 5 7 9

11

13

15

17

19

21

23

25

27

29

31

33

35

37

39

41

43

45

47

49

51

Eu

ro/k

g

Weekly pigs prices 156/176 kg - at farm gate

2012 2013 2014


123

Source: Chamber of Commerce of Siena

Volatility Index for live pigs prices Indicator V.2 Type of chain Volatility

index

Years Notes


monthly live pigs prices over

3 years

Generic ham

(global)

n.r. n.r. Light live pigs are imported

from NL: not relevant

Parma PDO

(regional)

0.103 2012-2013 Heavy live Italian pigs

Cinta S. PDO (local) 0.013 2012-2013 Cinta Senese live pigs

Source: our elaboration on CRPA and Chamber of Commerce of Siena

V.3 - Fresh ham price volatility

Fresh ham prices are quoted officially for both heavy pigs (fresh hams for the production of Parma

Ham and other PDO Italian cured hams) and other national pigs (non-PDO hams. Prices of fresh

hams for PDO are systematically higher than those of the non-PDO, but the two volatilities are

comparable over the period examined. Fresh ham prices are not quoted for Cinta Senese pigs,

because there is no a market for fresh hams but only for pigs as whole; the volatility for Cinta

Senese PDO fresh ham prices can be approximated by the price of live pigs..

Source: our elaboration on CUN data

3,0

3,1

3,2

3,3

3,4

3,5

gen

feb

ma

r

apr

ma

g

giu

lug

ago

set

ott

nov

dic

Eu

ro/k

g

Monthly Cinta Senese PDO live pigs prices - at farm gate

2011 2012 2013

2,00

2,50

3,00

3,50

4,00

4,50

€/k

g

Fresh ham prices

Fresh ham for Parma PDO (11-13 kg)

Fresh ham for generic ham (14 kg)


124

Volatility Index for fresh ham prices Indicator V.3 Type of chain Volatility

index

Years Notes


monthly fresh ham prices

over 30 months

Generic ham

(global)

0.053 06/2011 –

12/2013

Fresh ham for generic ham (14

kg)

Parma PDO

(regional)

0.051 06/2011 –

12/2013

Fresh ham for Parma PDO

(11-13 kg)

Cinta S. PDO (local) 0.013 2012-2013 Cinta Senese live pigs

Source: our elaboration on CUN data

V.4 - Cured ham price volatility

Cured ham prices are measured at the final stage of the supply chain, that is selling from producer

to the final seller / distributor. According to our elaborations, volatility is higher in the global chain

than in the regional one. It is not possible to calculate a price representative for the Cinta Senese

cured ham at the final stage of the chain, because the high variability between marketing channels

and also because of there is not really a wholesale market for this niche product.

Source: our elaboration on Parma market data

Volatility Index for cured ham prices Indicator V.4 Type of chain Volatility

index

Years Notes


monthly live pigs prices

over 3 years

Generic ham (global) 0.049 2011-2013 Generic cured ham, >8Kg, from

producer to final seller

Parma PDO (regional) 0.040 2011-2013 Cured Parma Ham PDO, <16

months, 9-11 kg, from producer to

final seller

Cinta S. PDO (local) N.A. N.A. N.A.

Source: our elaboration on Parma market data

7.1.2. Pig farming analytical indicators results

A.1 and A.2- Farmers upstream integration

4,00

6,00

8,00

10,00

12,00

gen

-11

mar

-11

mag

-11

lug-

11

set-

11

no

v-1

1

gen

-12

mar

-12

mag

-12

lug-

12

set-

12

no

v-1

2

gen

-13

mar

-13

mag

-13

lug-

13

set-

13

no

v-1

3

€/k

g

Cured ham prices

Cured Parma ham PDO, <16 months, 9-11 kg, from producer tofinal seller

Generic cured ham, >9Kg, from producer to final seller


125

As far as farmers upstream integration by ownership is concerned the following considerations can

be made. The Dutch pig farmers raising light pigs often have a limited land area which are both

pasture and arable land for the production of maize silage. Self production of feed on these farms is

therefore negligible. The Italian heavy pig farms often dispose of some arable land for the

production of cereals which is either sold on the market or used as self produced feed. Moreover

many large pig farms do have their own feed mill and buy the raw materials directly on the market.

In the Cinta Senese PDO chain many farmers feed their animals with its own products, but it is not

possible to estimate the percentage of feed produced directly by farmers. The traditional rearing

system was based on a seasonal pasture in the woods, and the Product specification imposed a

maximum limit on the amount of feed that can be bought on the market: feed should be provided

primarily by forests and pastures, and supplementary feeding is allowed up to a maximum of 2% of

live weight, or 3% of live weight when adverse weather conditions occur. In addition, this

supplementary feed shall for at least 60% be produced in Tuscany.

What is happening, also in response to increasing prices of concentrate and other feed raw

materials, is that many Cinta pig farmers are trying to produce on their own the feed. On the basis

of our enquiries on a sample of 11 farmers, approximately 30% of Cinta Senese farmers self-

produce the majority of feed they need. Another 40% buys raw materials for producing feed instead

of concentrates.

Farmers upstream integration by ownership Indicator A.1 Cured ham chain Value Notes

% of pig farmers which

don’t self-produce the

majority of feed

Generic ham

(global)

100% Expert consultation

Parma PDO

(regional)


Cinta S. PDO (local) 70% Sample of 11 Cinta Senese farmers


Concerning the presence and extent of mid or long-term contractual arrangements, in Parma PDO

chain Italian heavy pig farmers primarily buy their feed on the free market, except for those pig

farmers which are part of an integrated company such as Veronesi-Montorsi group, Martini and

other smaller companies. These companies represent about 12% of the market.

Contractual arrangements are not spread in global supply chain. In Cinta Senese PDO system up to

now there are not formal contractual arrangements between pig farmers and farmers growing

cereals or oilseeds for animal feeding, but Cinta Senese consortium is trying to support the

development of these kind of arrangements but up to now without tangible results.

Farmers upstream integration by contractual arrangements Indicator A.2 Cured ham chain Ordinal scale Notes

Part of pig farmers involved

in mid-long term upstream


with animal feed producers

Generic ham

(global)

3 Expert consultation

Parma PDO

(regional)

2 Expert consultation

Cinta S. PDO (local) 3 Expert consultation and direct interviews/focus

group

NOTE: level 1 (very high part of farmers is involved: in favour of resilience), level 2 Intermediate, level 3 (very small

part is involved: unfavourable to resilience).



126

A.3 - Farmers downstream integration

As far farmers downstream integration is concerned, in the local chain (Cinta Senese) a number of

farmers process their own pigs and produce cured ham and other cold cuts. This allows them a

better control on prices and gain higher added value. On 58 farms of Cinta analyzed (out of a total

of about 80 entered in PDO), 26 are engaged in processing and sale of Cinta Senese PDO meat

products (45% of firms). However in terms of quantities the weight of products processed by

farmers is much lower.

In global and regional chains, downstream integration is pursued mainly by means of farmers’

cooperatives or producers organizations. Dutch pig farmers operate on the free market, even if one

big cooperative (Vion) was created by a regional producers’ association. The large majoity of pig

farmers operate on the free market in Italy too, however some producer organizations are able to

concentrate supply and their role increased significantly in recent years. Organizations like OPAS,

ASSICOM and ASSER aggregated in the national organization UNAPROS now represent about

10% of the market. Pig farmers delegate their market power to these organization which sell the

pigs to slaughterhouses on behalf of their members.

Due to lacking exhaustive quantitative data, downstream integration is evaluated by means of

qualitative indicators based on a comparison between the three chains (scale from 1 = very high to 3

= very low or absent).

Farmers downstream integration Indicator A.3 Cured ham chain Ordinal scale Notes

Relevance of farmers downstream

integration

Generic ham (global) 3 Expert consultation

Parma PDO (regional) 2 Expert consultation

Cinta S. PDO (local) 2 Qualified sample of Cinta firms.

NOTE: level 1 (a very high part of farmers develops downstream integration: in favour of resilience), level 2

Intermediate, and level 3 (very small part of farmers develops downstream integration).


A.4 - Farmers product diversification

The Dutch light pig farmers are very specialized in pig rearing, so their product diversification is

almost completely absent. The Italian heavy pig farmers may produce some cereals and maize

silage on their arable land and sell these products on the market. Their share in the total receipts of

the pig farm does not go beyond 10%.

In the Cinta Senese chain the situation is very different. Traditionally, the rearing of Cinta Senese

represent for farmers an integration of their income, although after year 2000 - because of the fame

and commercial success of Cinta Senese ham, salami and other cold cuts – some farmers have

specialized in Cinta Senese rearing making this their main activity. Even in these cases, firms must

still comply with the rules established by the PDO Product specification, that is the maximum

density of 1.500 kg of live weight per hectare and the limit of feed purchased in the market.

The Cinta Senese pig farms are in most cases highly diversified and their income relies on many

different activities than production of pigs. According to our enquiries on a sample of 11 farmers,

approximately 47% of the total turnover deriving from farming comes from Cinta Senese pigs

(value calculated on the basis of the price for live pigs). This high level of diversification is often

due also to the fact that many farmers manage agritourism activities and other services activities,


127

and/or developed downstream integration, managing Cinta Senese meat processing activities and

selling their products directly to consumers

Farmers product diversification Indicator A.4 Cured ham chain Value Notes

% of (light/ heavy/Cinta)

pigs for ham production on

the total turnover of farm

Generic ham

(global)


Parma PDO

(regional)


Cinta S. PDO (local) 53% Sample of 11 Cinta Senese farmers. The value is

calculated on the basis of the price for live pigs.

Agritourism revenues are non considered in the total

revenue.


A.5 - Farm-level resistance against price-volatility

Added value is calculated taking the difference between farm gate, wholesale and retail prices and

non-factor costs at each stage of the pork chain taking into account the valuation of the pig carcass

from producer to consumer. For Dutch pig farms data refer to a representative sample of Dutch pig

farms, source of data is Interpig (BPEX, 2013). For Italian pig farms source is the yearly bulletins

of CRPA dedicated to the production costs of heavy pigs in Italy (CRPA, 2013), making reference

to a representative sample of Italian pig farms, which are certified for the production of heavy pigs

for the PDO Parma Ham value chain.

Price volatility of the input and output markets of relevance for pork production, defined as the max

delta added value per kg live weight per year over the period 2009-2013, points out a better

performance of the global chain (0.10 €/kg added value delta) than the regional chain (0.13 €/kg).

No data are available for Cinta Senese pig farmers for the years considered.

Farm-level resistance against price-volatility Indicator S-1 Cured ham chain Value Years Notes

Maximum delta of added value per

kg live weight per year

Generic ham (global) 0.10 2009/13 Interpig data

Parma PDO (regional) 0.13 2009/13 CRPA data

Cinta S. PDO (local) n.a. 2009/13 Quantitative data not

available

Source: our calculations on Interpig and CRPA data.

The interpretation of this delta is not easy, also due to the short period, but if we look at the

components of value added in Parma Ham chain (see the graph) it seems that the trend of sale price

of heavy pigs compensate the increasing trend in feed costs. The comparison between the trend of

the added value of Dutch light pigs and Heavy pigs shows a greater variability of the value added of

the Dutch live pigs not that of heavy pigs, even though the former has a smaller difference between

the maximum and minimum values.


128

Value added and its components per Kg of heavy pig ((€/kg live weight)

Source: CRPA

Value added per kg of Dutch light pigs and Heavy pigs (€/kg live weight)

Source: CRPA


The very high productive results of both Dutch light pigs and Italian heavy pigs raised in very large

production units are supported by a significant use of antibiotics. In particular pigs until the age of 2

months are treated. According to an expert consultation of veterinarians there is no significant

difference in the use of antibiotics between Dutch and Italian pig farms.

Cinta Senese pig farms do not use or use antibiotics only to a very limited extent. This local

autochtonous pig breed is rather resistant against diseases. Moreover, the pigs are raised in small to

very small groups, where the sanitary pressure is quite low

Use of antibiotics in pig farms Indicator A.5 Cured ham chain Value Notes

Use of antibiotics on pigs Generic ham (global) 3 Expert consultation

Parma PDO (regional) 3 Expert consultation

Cinta S. PDO (local) 1 Expert consultation

NOTE: the ordinal scale is the following: level 1 (low use of antibiotics), level 2 Intermediate, and level 3 (high use of

antibiotics).

0

0,2

0,4

0,6

0,8

1

1,2

1,4

1,6

2009 2010 2011 2012 2013

Sale price

Feed costs

Other non factor costs

Value added

0

0,05

0,1

0,15

0,2

0,25

0,3

0,35

2009 2010 2011 2012 2013

Dutch live pigs

Heavy pigs


129

7.1.3. Slaughtering results


Vertical integration for heavy Italian pigs tends to increase. After market crisis and price

shocks a growing number of pig farmers adhere to agistment contracts proposed by downstream

firms. As stated above these interest about 15% of the pigs marketed. This allows to the whole

Parma Ham chain to increase resilience at one side, but introduces at the other side also unbalanced

market relationships.

In Cinta Senese supply chain, two important ham processing firms manage directly a pig

farm. It is also common for ham processors to have ongoing relationships, though often not formal,

with the farmers to secure animals fit their needs.

Slaughterhouses/processors upstream integration Indicator A.7 Cured ham chain Ordinal scale Notes

Part of

slaughterhouses/processors

involved in pig farming and/or

in long term contractual

arrangements

Generic ham

(global)

3 There are no contracts between Dutch pig

farmers and Italian slaughterhouses.

Expert consultation

Parma PDO

(regional)

2 Direct surveys and expert consultation

Cinta S. PDO

(local)

1 Relevant both by ownership and by means of

long term arrangements (often informal)

Direct survey and expert consultation

NOTE: the ordinal scale is the following: level 1 (very high part of slaughterhouses/processors is involved: in favour of

resilience), level 2 Intermediate, and level 3 (very small part is involved).


A.8 - Slaughterhouses downstream integration

In Parma PDO supply chain downstream vertical integration is increasing, mainly by means direct

ownership. According to a survey on 94 ham processors (out of 150 in the Parma district)

representing the 55% of the PDO Parma cured ham production (Dentoni et al, 2012), 14 firms

(14,9% out of the 94 interviewed) were vertically connected to upstream firms (both owners of a

slaughterhouse and/or a pig farm). These 14 firms produce the 34,0% of the total PDO Parma cured

ham production. The main reason for downstream integration of slaughterhouses is to increase their

resilience by capturing the value added generated in the processing industry, as the value added of

slaughterhouses is very limited. Moreover, slaughterhouses are economically highly vulnerable as

they operate in between two highly volatile markets. Dutch slaughterhouses do not present

significant degrees of downstream integration, also because most of the meat of light pigs is sold

unprocessed and directly on the retail market In Cinta Senese PDO supply chain slaughterhouses

are not specialized in Cinta Senese. There are not cases of downstream integration.

Due to lacking exhaustive quantitative data, downstream integration is evaluated by means of

qualitative indicators based on a comparison between the three chains (scale from 1 = very high to 3

= very low or absent).


130

Slaughterhouses downstream integration

Indicator A.8 Cured ham chain Ordinal scale Notes

Relevance of slaughterhouses downstream

integration (qualitative)




NOTE: the ordinal scale is the following: level 1 (a very high part of slaughterhouses develops downstream

integration), level 2 Intermediate, and level 3 (very small part of slaughterhouses develops downstream integration).


A.9 - Slaughterhouses product diversification

No quantitative official data are available on Dutch and Parma PDO district slaughterhouses, but in

general they are very specialized firms and, also according to expert advice, their degree of

diversification is very low.

On the other side, pigs – and Cinta Senese pigs – represent only a small part of the activity of

Tuscan slaughterhouses. In Tuscany the slaughtering phase is fragmented and there are not big

firms unlike Emilia Romagna and other Northern Italian regions. Anyhow slaughtering firms in

Tuscany don’t play a strategic role in the supply chain.

Slaughterhouses product diversification Indicator A.9 Cured ham chain Value Notes

Part of activity not linked to production of generic / Parma

PDO / Cinta Senese ham on the total turnover of slaughtering

firms

Generic ham (global) 3 Expert

consultation

Parma PDO (regional) 3 Expert

consultation

Cinta S. PDO (local) 1 Expert

consultation

NOTE: the ordinal scale is the following: level 1 (high product diversification: in favour of resilience), level 2

Intermediate, and level 3 (very low product diversification).


7.1.4. Ham processing results


The same than Slaughtering.

A.10 - Processors product diversification

On average, in the Parma Ham district the share of hams production on total production is higher

for firms producing Parma Ham (60.1%) than for firms producing generic ham (50.5%) (see table

below).


131

Share of ham production on total production in Parma Ham district % of Parma Ham on total production (mean) 60,1%

% of Parma Ham on total production (median) 68,0%

% of Parma Ham on total production (std dev) 33,3%

% of generic ham on total production (mean) 50,5%

% of generic ham on total production (median) 46,2%

% of generic ham on total production (std dev) 37,9%

Source: Elaboration UNIPR on Parma Ham consortium and AUSL

Out of 216 processors in the district of Parma Ham (year 2013), 178 were producing Parma Ham

while 38 were specialized in the only production of generic ham. Out of the 178 firms producing

Parma Ham PDO, in 23 cases Parma Ham production is marginal (<10%), while for a large part of

firms Parma Ham is very important (51 out of 178 produced almost exclusively Parma) (see table

below).

Degree of specialization in the production of Parma Ham PDO Share of Parma Ham PDO on total production Number of firms % of firms

0 - 10% 23 12,9%

10% - 20% 10 5,6%

20% - 30% 11 6,2%

30% - 40% 10 5,6%

40% - 50% 9 5,1%

50% - 60% 14 7,9%

60% - 70% 13 7,3%

70% - 80% 14 7,9%

80% - 90% 23 12,9%

90% - 100% 51 28,7%

Total 178 100,0%

Source: Elaboration UNIPR on Parma Ham consortium and AUSL

In the Cinta Senese supply chain, the PDO covers only fresh meat and not processed products, but

the Cinta Senese Consortium has created a collective mark for ham and other cold cuts made from

Cinta Senese PDO certified meats. In Cinta Senese supply chain the situation is very different, first

of all because of, unlike that in Parma district, here processors transform the whole carcass

producing not only cured ham but all types of meats: this allows for a first type of diversification.

Secondly, we observe two distinct groups of processors:

- The first group consists of pig farmers who manage also meat processing, by means of a

downstream integration: in this case normally the vast majority of the production is of Cinta

Senese products, even if in some cases farmers breed also other kind of pigs.

- The second group consists of firms (more or less) specialized in processing pigs meats. It’s a

very composite group: together with some bigger industrial firms there are some artisanal

firms, and also some small butchers shops. In this group the share of Cinta Senese processed

products over the total turnover is low, but the contribution of Cinta Senese ham and other

cold cuts is often very high because of they improve the perceived quality of the whole

assortment of the firm.


132

Processors product diversification Indicator A.10 Cured ham

chain

Value Notes

Share of processing firms with a share of

(generic / Parma PDO / Cinta Senese)

ham higher than 70% on the total

turnover of processing firms, on the total

number of firms

Generic ham

(global)

33.0%

Parma PDO

(regional)

49.5%

Cinta S. PDO

(local)

0% Due both to the fact that firms process also

meats different from the Cinta Senese one,

whether over the Cinta ham also other Cinta

cold cuts are produced.


A.11 – Processors marketing channels diversification

Data on market diversification for Generic cured ham producers are not available. For Parma Ham,

as far as marketing channels are concerned, a recent survey done by University of Parma on the

Parma Consortium firms (94 respondents). On average, firms make 28% of sales with Supermarkets

groups, 30% with traditional retailers, 3% wholesalers with and 40% in other ways (eg. direct

channels, export, catering). Considering single firms data, 52% of firms depend for more than 66%

from a single market channel out of the four considered.

Number of processing firms with a share of turnover higher than 66% in one marketing channel Marketing

channels

Supermarkets

chains Traders Whoelsalers Other

Total

firms not diversified

Total firms

interviewed

Number of firms 13 9 0 27 49 94

In % 13,8% 9,6% 0,0% 28,7% 52.1% 100,0%

Source: UNIPR

Cinta Senese ham and other processed products are niche products, and they are sold on more

fragmented marketing channels. Small producers, both integrated pig farmers and small processing

firms, follows a range of marketing channels: direct selling (both on-farm and on farmers’ markets),

local restaurants and butcher shops, consumer purchasing groups, delicatessen shops, and in some

cases also supermarkets. The few bigger processors sell normally most of their Cinta products to

supermarkets, but they keep also a distribution network directly managed.

Processors marketing channels diversification for cured ham Indicator A.11 Cured ham chain Value Notes

Degree of market


processors, in terms of

marketing channels

Generic ham (global) 1 Expert consultation

Parma PDO (regional) 2 Based on quantitative data

Cinta S. PDO (local) 1 Data from direct survey and expert consultation

NOTE: the ordinal scale is the following: level 1 (high marketing channels diversification: in favour of resilience), level

2 Intermediate, and level 3 (very low marketing channels diversification).


A.12 – Processors geographical markets diversification

Generic cured ham is produced almost exclusively from imported fresh hams. Most of the cured

ham is sold on the domestic market, but a significant share is exported both to EU and non-EU


133

countries. On the retail market this product often enjoys and exploits the reputation of PDO Parma

Ham.

Parma Ham, thanks also to PDO and collective promotional efforts, is exported in many EU and

non-EU countries and interest almost 30% of the total production. The main export countries are the

USA, Germany and France.

Cinta Senese ham is sold mainly in Tuscany and on niche channels in Northern regions of Italy.

Some firms sell small quantities of ham on foreign markets, while important are sales made to

foreign customers who spend their vacation in Tuscany.

Processors geographical market diversification for cured ham Indicator A.12 Cured ham chain Value Notes

Degree of market diversification of ham processors, in terms of

geographical markets




NOTE: the ordinal scale is the following: level 1 (high geographical market diversification: in favour of resilience),

level 2 Intermediate, and level 3 (very low geographical market diversification).


A.13 – Processors product differentiation

In both regional (Parms PDO) and local (Cinta Senese) supply chains collective marks play a

relevant role. In particular Parma PDO is very reputed on Italian and foreign markets, also thanks to

promotion campaigns.

On the other side Cinta Senese cured ham enjoys a collective trademark that link the cured ham

production to the PDO on fresh Cinta Senese meat, guaranteeing consumers about the provenance

and quality of the raw material. Cinta Senese ham is less known by consumers, and it suffers from

the competition of labels which made a generic reference to the Cinta Senese breed.

Generic ham differentiation is based only on individual trademarks and cannot count of an

collective “umbrella” trademark. Large companies exploiting economies of scale are able to

promote their company trademarks. Moreover, they enjoy the positive reputation of PDO Parma

Ham.

Product differentiation for cured ham Indicator A.13 Cured ham chain Value Notes

Degree of product differentiation for cured ham by

means of collective labelling systems




NOTE: the ordinal scale is the following: level 1 (high product differentiation: in favour of resilience), level 2

Intermediate, and level 3 (very low product differentiation).



134

7.2. Annex 2 – Methodological approach used for LCA

The methodological approach adopted for each of the production chains is based on the data

collection at some typical farms, slaughterhouses, ham curing companies and retailers which were

representative of the different chains.

7.2.1. Parma pigs

To choose the type of farm of heavy pigs for the production of Parma we have collected

data from the recent CRP study that analyzed data from regional Nitrate Database (Emilia Romagna

and Lombardia). These regions are highly representative of the pig population, in particular for the

64% and 89% for Italian pigs respectively.

For the Parma Ham supply chain we identified a typical farm size of 3,200 fattening pigs

with a housing system with fully-slatted floors following the EU legislation.

In Figure 13.1.1 are included the main input data typical of the farm for the production of

heavy pigs for the production of Parma Ham.

Figure 13.1.1 – Pig breeding farm for heavy pigs destined to Parma Ham

Region Parma Ham area

Area plain

n° animals (25-160 kg) 3 200

Starting weight [kg] 25

Final weight [kg] 160

Fattening period [d] 192

Period for the cleaning of the structures [d] 10

N* of cycles per year 1.8

Mortality [%] 3.3

Feed conversion index [kg feed / kg meat] 3.1

Meat production per year [t live weight] 925

Pig housing fully-slatted floor

Crop area [ha] 58

Tyoe of crop Maize


135

Feed extra needed [t/y] 2066

Slurry [t/y] 9444

In the case of fattening breeding the inputs of the piglets must also be considered. The calculation of

the impact of the piglets have been obtained using methodology similar to the fattening breeding,

(figure 13.1.2.

Figure 13.1.2 – Pig breeding farm for Parma piglets destined to Parma Ham

Region Parma Ham area

Area Plain

n° calving sows 128

n° pregnancy sows 473

n° weaning piglets (0-12 kg) 1370

n° weaning piglets (12-25 kg) 1155

n° growing sows 60

n° boars 13

Mortality [%] Variable in the different phases (from

9.9 to 1 %)

Piglets per year, live weight [t(y] 241

Housing piglets In the box, fully slatted without

defecation external passage and the

storage pit

Housing farrowing sows In the box crate with storage pits and

removal slurry at end of cycle

Housing growing adn pregnancy sows Fully slatted without defecation

external passage and storage pit

Crop area [ha] 21.4

Type of crop Maize

Feed extra needed [t/y] 1003

Slurry [t/y] 5892


136

The ration is a primary element for the assessment of environmental impacts of farming.

In the table 13.1.3 are reported rations adopted in this farming system.

Figure 13.1.3 – Composition of the pig rations

Ration (%) amount

[kg/d] composition [%]

Maize

meal

Barley

meal

Soy

meal Bran Soy oil

Supple-

ment Whey

Piglets 0-12 kg 0.38 43.0 23.5 14.5 5.0 3.5 3.0 7.5

Piglets 12-25 kg 0,89 45,2 24,7 13,4 8 3,5 2,6 2,6

Pigs 25-50 kg 1,5 45.5 21.0 17.5 10.0 2.5 3.5

Pigs 50-100 kg 2,4 42.0 23.0 18.0 14.0 3.0

Pigs 100-160 kg 3,1 50.0 25.0 16.0 6.0 3.0

Pregnancy sows 2,3 30.8 29.0 14.2 24.5 1.5

Lactating sows 5,5 32.8 28.0 15.7 18.5 3.0 2.00

Boars 2,3 30,8 29 14,2 24,5 1,5

The feeding of pigs is based largely on maize. The 57.4% of maize was product in local

farm: 21.4 ha of local production with a yield of 13 t/ha. We included the impact of maize milling.

For the remaining part of the diet components consist of barley, soy, supplements etc.

In the Figure 13.1.4 you find data for Electric consumption for pig and piglets, that have

been collected in a CRPA research named “RE Sole”.

Figure 13.1.4 – Electricity consumption for pigs and piglets

Electric consumptions Fattening pigs

KWh/year/LU

Piglets

KWh/year/LU

Feed milling 14.32 27.87

Feed distribution 61.31 20.14

Ventilation and heating 95.08 85.12 + 70.84 termic

Slurry removal 10.01 8.4

Slurry treatment 10.06 6.03

Slurry distribution 31.08 19.35

Lighting 2.85 6.47


137

Other input

We have also considered: washing agents 0.17 kg/pig (CRPA data); packaging and others

0.18 kg/pig (CRPA data); transports (transport feed 50 km, transport piglets 70 km) and water

consumption: pig: 10.347 m3/farm/year; piglets 6.863 m3/farmyear.

7.2.2. Cinta Senese pigs

We identified a typical farm also for Cinta Senese pig, representative of the supply chain

raised indoor/outdoor.

We have chosen a typical farm: breeding confined indoors for lactating and weaning,

breeding with commercial feed during growth and fattening, exclusive grazing in the forest in the

final stage (four last months).

Exclusive outdoor breeding with poor dietary supplementation or only indoor breeding can

be ignored because is not conforming to the classic Cinta Senese pig production.

According to the product specification of the breeding Cinta Senese pig: in outdoor breeding is

allowed a maximum of 1,500 kg of liveweight per hectare. During the grazing additional feed is

permitted with quantities not exceeding 2% of the live weight of the animal. Based on the data

collected in the publications of the Tuscany Region about specific studies on Cinta Senese we opted

for a breeding a closed cycle with 21 sows.

In the Figure 13.1.5 5 are included the main input data

Figure 13.1.5 – Base data for the Cinta Sense pig farm

Region Tuscan Region

Area Hill area

n° calving sows 4

n° pregnancy sows 17

n° of weaning piglets [0-12 kg] 28

n° of weaning piglets [12-25 kg] 24

n° of weaning piglets [25- 50kg] 37

n° of fattening pigs [50-130 kg] 115

n° of grazing fattenig pigs [130-150 kg] 53

n° boars 2

Final weight [kg] 150

Fattening period [d] 448

Weaning mortality [%] 10

Feed conversion index [kg feed / kg meat from-to] 4.5-9.3


138

Meat production per year [t live weight] 31.5

Housing piglets In cages with multiple storage

pits below

Housing farrowing sows In the box crate with storage pits

and removal slurry at end of cycle

Other pigs Outdoor breeding and grazing

In the Cinta Senese breeding the supplementary feed must derive at least 60% of the total weight coming to the geographical area of production. For these additions are allowed the following products:

- Energy products: all grains, EN 8.7.2011 Official Journal of the European Union C 200/17

- Protein products: oil (with the exception of soy and derivatives) and all legumes grains,

- Fibers: fodder, fruit and vegetables, cereal milling byproducts. It also allowed the use of vitamin and / or mineral.

In Figure 13.1.6 is described the rations composition of Cinta Senese pig.

Figure 13.1.6 – Feed ration of the Cinta Senese pigs

Ration (%) amount

[kg/d] composition [%]

Maize Barley Protein

peat Bran

Rape

oil

Supple-

ment

Fava

bean

Piglets 0-12 kg 0.38 43.0 23.5 14.5 5.0 3.5 3.0 7.5

Piglets 12-25 kg 0,89 45,2 24,7 13,4 8 3,5 2,6 2,6

Pigs 25-50 kg 1,4 28.0 40.0 15.0 1.0 16.0

Pigs 50-130 kg 2,55 28.0 40.0 15.0 1.0 16.0

Pigs 130-150 kg 10

(Acorns)

Pregnancy sows 2,4 30.8 29.0 14.2 24.5 1.5

Lactating sows 5,1 32.8 28.0 15.7 18.5 3.0 2.00

Boars 2,4 30,8 29 14,2 24,5 1,5


139

For the other input energy and more are estimating the same input for Parma in proportion to the

size of the Parma in particular with a lower energy consumption farm outdoors livestock.

7.2.3. Emissions

For the ammonia emissions we used a methodology included in the calculation file for the NH3

manure management from EMEP/EEA emission inventory guidebook 2013

(http://www.eea.europa.eu/publications/emep-eea-guidebook-2013)

For the nitrous oxide emissions we adopted the IPCC emission factor N-N2O 0.001 (indoor) and

0.02 N-N2O (grazing).

N2O= N excreted x 0.001 (0.02 grazing) x 44/28

For the quantification of the enteric pig emissions CH4 (methane) we used the emission factors

adopted in the Italian national inventory (1.5 kg CH4/pig/year).

For the manure/slurry management CH4 emissions we adopted the IPPC Tier 2 that it is included in

the calculation tool CoolFarm, a software developed by the University of Aberdeen, Unilever and

Sustainable Food Lab (http://www.coolfarmtool.org/CoolFarmTool.

The leaching from manure/slurry is included in the production of the feed where transportation and

application of manure is included.

Emissions of the application of surplus manure are allocated to the receiving crop (so; in our case it

is not included because the receiving crop is no feed for the pigs).

7.2.4. Slaughtering for Parmapig and generic light pig

For the phase of slaughter data were collected at the Italcarni swine slaughterhouse in the

Parma Ham central zone where pigs are slaughtered for Parma Ham and for the generic crude ham.

Founded in 1987 Italcarni Sca is the leading company in Italy for meat pork butchering and

processing.

The activity of Italcarni covers the entire processing range : butchering, boning and

portioning of fresh meats - offers of the various types of cuts - and the production of meat portions

and products. Italcarni distributes its products throughout the entire Country and abroad; the main

sales channels are Industry and Supermarkets. Italcarni is dedicated to innovation in terms of

technologies and production processes, in order to protect consumers, collaborators and their work


140

environment.

The slaughterhouse in 2013 slaughters about 750,000 pigs with 167 kg average heavy live; the

carcass yield is about 80%. In the figure 13.1.7 the data collected in Italcarni Slaughterhous are

reported

Figure 13.1.7 –Italcarni slaughterhouse data

Input Per Year Per Pig

Electricity kWh 15,265,803 20,354

Natural gas m3 1,415,682 1,888

Tap water m3 200,163 0.267

Well water m3 200,096 0.267

Detergents kg 39,191 0.052

Kraft paper kg 421,608 0.562

Plastic kg 193,183 0.258

Disposable material kg 1,668 0.002

Pallet n° 2,517 0.003

Lubricating oil 2,355 0.003

Transport pig tkm 37,575 50

7.2.5. Slaughterhouse for Cinta Senese pig

For the Cinta Senese pig we have collected data at the slaughterhouse “Macelli di San Miniato

Srl” located in the Cinta Senese area. This slaughterhouse is recognized and authorized to operate

in accordance with the procedures of the specification for the DOP of Cinta Senese.

The slaughterhouse slaughters in 2013 about 750 Cinta Senese pigs with 120 kg average heavy live;

carcass yield is about 80%.

Figure 13.1.7 –San Miniato slaughterhouse data

Input Per Year Per Pig

Electricity kWh 250 0.33

Natural gas m3 4500 6

Tap water m3 540 0.72

Well water m3 1100 1.47

Detergents kg 40 0.053

Transport pig tkm 5400 7.2

Diesel fuel l 3000 4


141

7.2.6. Ham factory for Parma and generic crude ham

After slaughtering, the fresh thighs are transported to the next stage for processing and seasoning at

the ham factory. As a reference we used data from a ham company for the exclusive production of

Parma Hams: Monica & Grasso S.p.A. work in the food industry currently produces about 90,000

hams per year, he works and seasonig exclusively prosciutto di Parma DOP.

The data are obtained from average of nine years of data collection and derived from the

Environmental Statement in May 2010 (figure 13.1.8).

Figure 13.1.8 –Monica&Grasso SpA company data – average of the last nine years

Input Per kg of ham fresh

Electricity kWh 1.29

Natural gas m3 0.114

Tap water m3 0.011

Detergents kg 0.0004

Packaging kg 0.0254

Sugna (fat) kg (greasing mix) 0.0049

Salt kg 0.0718

Transport fresh ham tkm 0.08

Weight of fresh hams: fresh hams trimmed, weight preferably ranges between 12 and 14

kilograms, must not in any case weighing under 10 kilograms (DOP). We have considered an

average weight of 12.86 kg of fresh ham and a final weight at the end of seasoning of 9 kg with a

weight loss of 30% during the seasoning

7.2.7. Generic crude ham seasoning

For transport we estimated a distance between the Dutch slaughterhouse and the Italian ham

Company of 1,200 km. The generic cured ham you get with the conventional technique, based on

dry salting, and seasoned (no more than 22 ° C) for a total production time of at least 7 months

(hams smaller) or 9 months (weigh more than 8 kg).

For the curing of ham generic calculations we considered a ham with weight of 8 (30%

weight loss, fresh ham 11.43 kg). We have estimated nine months of seasoning with lower energy

consumption by 25% and increased use of estimated amount of salt in 25% more compared to the

Parma Ham processing.

7.2.8. Ham seasoning company for Cinta Senese

The data for the curing of Cinta Senese ham derived from the Sapito srl company from

Montaione (FI). That produces about 1500 hams per year (Figure 13.1.8). The 60% of the 1500 pig


142

slaughtered are the Cinta Senese pig hence has been applied an allocation of 60% on all input

factors. The average cured ham weight is of 7-8 kg and is about 10-11 kg of fresh hams.

Figure 13.1.8 –Sapito srl company data

Input Per kg fresh ham

Electricity kWh 1.06

Tap water m3 0.075

Detergents kg 0.0004

Packaging kg 0.0254

Sugna (fat) kg (greasing mix) 0.0057

Salt kg 0.1143

Transport fresh ham tkm 0.04

7.2.9. Transport and retail

At the end of the seasoning the product is transported to the sale. We considered impacts

from transport and refrigeration. For transportation we estimated a medium transport in Italy. For

Parma Ham we esstimated a transport of 400 km is approaching at a distance of distribution media

in Italy. For generic ham , who is seasoned in many geographical areas, we estimated a transport

medium of 200 km. For Cinta Senese ham which includes a distribution generally local a transport

operation we estimated 100 km. For the impacts resulting from conservation of the ham in the

refrigerator store we used the data from the Ecoinvent database; supermarket for Parma and Generic

and small store for Cinta Senese.


143

7.3. Annex 3 – Dataset for Attribute Territoriality

Table A1: Parma ham PDO farming system

Province Region Pig farms within

the PDO a

N. pigs within the

PDO a

N. pigs /farms

within the PDO a

Farms with

livestock b

Pig farms on

farms with

livestock (%)

Brescia Lombardia 545 1,267,264 2,325 5,524 9.9%

Mantova Lombardia 448 1,178,149 2,630 2,557 17.5%

Cremona Lombardia 338 999,329 2,957 1,613 21.0%

Cuneo Piemonte 672 922,795 1,373 7,363 9.1%

Lodi Lombardia 158 424,026 2,684 610 25.9%

Reggio Emilia Emilia-

Romagna 235 365,633 1,556 2,099 11.2%

Bergamo Lombardia 104 317,925 3,057 3,632 2.9%

Pavia Lombardia 94 279,149 2,970 968 9.7%

Modena Emilia-

Romagna 186 256,353 1,378 2,151 8.6%

Verona Veneto 142 255,776 1,801 3,574 4.0%

Total 10

provinces* 2,922 6,266,399 2,145 30,091 9.7%

Other Italian

provinces 1,277 1,805,327 1,414 187,358 -

Total Italy

4,199 8,071,726 1,922 217,449 -

* first 10 provinces within the PDO system in terms of pigs bred.

Sources: our elaborations on data of a) the IPQ (2014) and b) the 2010 Agriculture Census (ISTAT, 2010).


144

Table A2: Cinta Senese PDO farming system

Province Region Pig farms within

the PDO a

N. pigs within the

PDO a

N. pigs /farms

within the PDO a

Farms with

livestock b

Pig farms on

farms with

livestock (%)

Arezzo Tuscany 5 336 67 1,308 0.4%

Firenze Tuscany 14 623 45 1,294 1.1%

Grosseto Tuscany 13 581 45 2,182 0.6%

Livorno Tuscany 2 86 43 384 0.5%

Lucca Tuscany 1 43 43 1,197 0.1%

Pisa Tuscany 8 367 46 959 0.8%

Pistoia Tuscany 1 43 43 442 0.2%

Prato Tuscany 2 86 43 196 1.0%

Siena Tuscany 35 1,546 44 1,051 3.3%

Massa-Carrara Tuscany 0 0 0 887 0.0%

Total 81 3,709 46 9,900 0.8%

Sources: our elaborations on data of a) the INEQ (2014) and b) the 2010 Agriculture Census (ISTAT, 2010).


145

Table A3: Parma ham PDO ham processing industry

Province Region

Parma PDO

processing

industries a

Generic ham

processing

industries b

Food Industry c

Parma PDO

processing

industries on food

industry (%)

Generic ham

processing

industries on food

industry (%)

Parma Emilia-

Romagna 150 190 1,209 12.4% 15.7%

Sources: our elaborations on data of a) the IPQ (2014), b) Giacomini et al. (2013a) ,and c) the 2011 Industry and Services Census (ISTAT, 2011).

Table A4: Cinta Senese PDO ham processing industry.

Province Region Cinta Senese PDO a Food Industry

b

Cinta Senese PDO

processing industries on

food industry (%)

Arezzo Tuscany 5 355 1.4%

Firenze Tuscany 6 773 0.8%

Grosseto Tuscany 1 330 0.3%

Livorno Tuscany 1 362 0.3%

Lucca Tuscany 0 412 0.0%

Pisa Tuscany 2 338 0.6%

Pistoia Tuscany 3 333 0.9%

Prato Tuscany 0 203 0.0%

Siena Tuscany 9 341 2.6%

Massa-Carrara Tuscany 0 253 0.0%

Total 27 3,700 0.7%

Sources: our elaborations on data of a) the INEQ (2014), and b) the 2011 Industry and Services Census (ISTAT, 2011).


146

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8.1.1. List of the main sources

Reference Description Data available

CINTA SENESE

Disciplinare di produzione della Cinta Senese Production Regulations: shows

the standards which must be met

to obtain the protected

designation of origin (PDO),

which is reserved exclusively for

fresh pork.

Franci O. (2004), La Cinta Senese, gestione

attuale di una razza antica, ARSIA – Regione

Toscana, Firenze

This book describes the

characteristics of the Cinta Senese

of farming systems, the market

and the situation of farms

Description of the

chain, actors, labelling

schemes

Franci O., Crovetti A., Esposito S., Sirtori F.

(2011), La realtà della Cinta Senese,in: Regione

Toscana (2011), “Il progetto europeo QUBIC

attualità e prospettive della razza suina Cinta

Senese”, Pacini Editore, pp. 21-48

Results of a survey of the Cinta

Senese supply chain

Regione Toscana (2011), “Il progetto europeo

QUBIC attualità e prospettive della razza suina

Cinta Senese”, Pacini Editore

It 'a photograph of the reality of

the supply chain of the Cinta

Senes. It’an project funded by the

EU (MED programme) centered

on 7 typical Mediterranean pigs

breeds

Survey on firms in

different stages of the

supply chain;

definition of good

practices

Websites

http://www.cintasenese.org Consortium for the protection of

the Cinta Senese

http://www.mattonedue.it/consorziosuini.html

http://www.cintasenese.eu/I_nostri_prodotti.html

http://www.sergiofalaschi.com/lista.php?idCateg

oria=4

http://www.renieri.net/cinta-senese.html

http://cintasenese.blogspot.it/

Website of the farmers and

processors

PARMA HAM PDO

Prosciutto di Parma (Parma Ham) Protected

Designation of Origin

Specifications and Dossier,

including all standards to obtain

the protected designation of origin

(PDO),

Product parameters

(e.g., moisture, salt)

Feed admitted during

the breeding phase

Dentoni, D., Menozzi, D., Capelli, M.G. 2012.

Group heterogeneity and cooperation on the

geographical indication regulation: The case of

the ‘‘Prosciutto di Parma’’ Consortium. Food

Policy 37, 207–216.

Study aiming to analyze the

heterogeneity of Parma Ham

Consortium members

characteristics, and the effect on

the Consortium strategies

Primary data available

about the firms

characteristics (n=79)

and questionnaire

items

Giacomini, C., Arfini, F., Menozzi, D., 2010.

Processi di qualificazione ed effetti spillover: il

caso del Prosciutto di Parma Dop. QA – Rivista

dell’Associazione Rossi-Doria 3, pp. 55–80.

Study analyzing and comparing

the Parma Ham PDO network and

the non-PDO network


about the Parma Ham

production and prices

O’Reilly, S., Haines, M., Arfini, F., 2003. Food

SME networks: process and governance. the case

of Parma Ham. Journal on Chain and Network

Science 3, 21–32.

Study analyzing the Parma Ham

PDO network

Mancini, M.C., 2003. Le produzioni alimentari

tipiche. L’impatto economico e organizzativo

This book provides a detailed

description of the governance of

http://www.cintasenese.org/

http://www.mattonedue.it/consorziosuini.html

http://www.cintasenese.eu/I_nostri_prodotti.html

http://www.sergiofalaschi.com/lista.php?idCategoria=4

http://www.sergiofalaschi.com/lista.php?idCategoria=4

http://www.renieri.net/cinta-senese.html


151

della normativa europea. Monte Università

Parma, Parma, Italy.

Parma Ham PDO and related

traceability system

Capelli, M.G. 2014. Indicazioni Geografiche,

Strategie di Differenziazione e Politiche per il

Consumatore. Phd Thesis, Department of

Economics, University of Parma

Phd dissertation aiming to analyze

the consumers preferences and

willingness to pay for different

quality labels associated with the

designation Parma Ham PDO


on the consumers

WTP an questionnaire

items

Websites

http://www.prosciuttodiparma.com/ Consortium of the Parma Ham

PDO

http://www.parmaqualita.it/chi_siamo.php Independent organization I.P.Q.

(Istituto Parma Qualità)

http://www.parmacotto.com/

http://www.grandisalumificiitaliani.it/

http://www.negroni.com/

Websites of the processors

http://www.borsamerci.pr.it/ Mercantile Exchange of Parma Prices of the PDO

hams and certified

meat

GENERIC NON-PDO HAM

Giacomini, C., Arfini, F., Menozzi, D., 2010.

Processi di qualificazione ed effetti spillover: il

caso del Prosciutto di Parma Dop. QA – Rivista

dell’Associazione Rossi-Doria 3, pp. 55–80.

Study analyzing and comparing

the Parma Ham PDO network and

the non-PDO network


about the non-PDO

ham production and

prices

Websites

http://www.assica.it/ Italian association of pig meat

producers

http://www.borsamerci.pr.it/ Mercantile Exchange of Parma Prices of the non-PDO

hams

http://www.parmacotto.com/#/it/home

http://www.grandisalumificiitaliani.it/

http://www.negroni.com/


152

Attribute Indicator Detailed indicator Source of indicator

Affordability Retail price Retail price in supermarket CPP

Retail price Retail price in supermarket ASSICA/Infoscan

Retail price Retail price at speciliased retailer shop Interviews

Dynamics in pork consumption Domestic market and exports CPP,ASSICA, CCS

Dynamics of pig meat

ISTAT

Added value VA at farm level/AWU Price of pigs- non factor costs

CRPA Notizie, Interpig

Interviews

VA slaughterhouse/AWU Price of fresh PDO ham-non factor costs Bilance sheets

VA ham factory/AWU Price PDO Parma Ham-non factor costs Balance sheets

Price of generic ham - non factor costs Balance sheets

Price of Cinta ham-non factor costs Interviews

Resilience Volatility of concentrate price Concentrate price Interpig

Volatility of live pig prices Price of live heavy pigs,light and Cinta pigs CCIAA

Volatility of fresh ham Price of fresh hams CCIAA

Volatility of cured ham Price cured ham CCIAA

Degree of diversification % heavy pigs on total turnover of farm Sample of farms

% light pigs on total turnover of farm Sample of farms

% Cinta pigs on total turnover of farm Sample of farms

% heavy pigs on total slaughterings

% light pigs on total slaughterings Balance sheets

% Cinta pigs on total slaughterings Interviews


153

% of Parma Ham on total turnover Balance sheets

% of generic ham on total turnover Balance sheets

% of Cinta ham on total turnover

Degree of downstream integration % ham by integrated companies CPP, CCS

Labour relations Qualitative analysis

Chain governance Degree of self governance % pigs marketed by producer orgn

% composition of CPP

% composition of CCS CCS

Animal welfare Level of animal welfare Risk assessment EFSA

Territoriality Degree of artisanality % AWU in artisanal phases of production

Effectiveness of PDO % feed produced within PDO

Events organised in the territory

related to the product Number of events and number of visitors CPP/Local authorities

Number of events and number of visitors CCS

Links with local touristic activities Ham routes; agritourism Province of Parma

Resource use Use of water LCA m3/kg carcass weight/fresh ham/cured ham Farm and company data

(water footprint)

Use of fossil energy LCA MJ/ kg carcass weight/fresh ham/ cured ham Farm and company data

Use of nutrients LCA kg NO3-eq/carcass /fresh hamd/cured ham Farm and company data

Pollution

Greenhouse gas emissions

(Carbon footprint) LCA kg CO2-eq/carcass /fresh ham/cured ham Farma and company data

Biodiversity Presence of local breeds Saving of local breed Interviews

Landscape conservation Conservation of forests Interviews


154

Land use LCA m2 land/carcass/fresh ham/cured ham Farm and company data

wp3 italian case study: local and global cured ham...

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