Italy - Country Commercial Guide
Agricultural Sector

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2021-10-29

Overview

The Foreign Agricultural Service (FAS) is part of the U.S. Department of Agriculture (USDA) and is U.S. agriculture’s link to the constantly changing global marketplace. Italy is the third-largest economy in the euro-zone, with a GDP estimated at $1.9 trillion and a per capita GDP of $31,630. Being a net agricultural importer, most raw materials and ingredients are imported, as Italy’s economic strength is in the processing and the manufacturing of goods, primarily in small and medium-sized family-owned firms. Italy exports mainly consumer products to the United States, while the United States exports mostly bulk commodities to Italy.

In 2020, U.S. agricultural exports to Italy were $1.0 billion, while U.S. imports from Italy were $5.5 billion.

U.S.- Italy Agricultural Trade 2020 

U.S. leading exports to Italy

Italian leading exports to the United States

Tree nuts: $314.4 million

Wine: $2.1 billion

Wheat: $216.3 million

Baked goods, cereals, and pasta: $754 million

Soybeans: $148.1 million

Olive oil: $533.9 million

Planting seeds: $56.6 million

Non-alcoholic beverages: $358.8 million

Distilled spirits: $41.2 million

Condiments and sauces: $345.9 million

Total: $1.0 billion

Total: $5.5 billion

Source: BICO

Agriculture is one of Italy’s key economic sectors, accounting for approximately two percent of GDP. Italy is one of the largest agricultural producers in the EU. Italy’s agriculture is typical of the northern and southern division found within the EU. The northern part of Italy produces primarily grains, soybeans, meat, and dairy products, while the south specializes in fruits, vegetables, olive oil, wine, and durum wheat. Even though much of its mountainous terrain is unsuitable for farming, approximately 4 percent of the population (60.3 million) is employed in farming. Most farms are small, with the average size being eleven hectares. Italian industries, including the food-processing sector, rely heavily on imports of raw materials. Italy is one of the largest agricultural producers and food processors in the EU.

Italian Food Importers and Retailers

The Italian retail food market is highly diversified.  Hypermarkets, supermarkets, convenience, discount, and specialized stores coexist with traditional corner shops and open-air markets. The majority of supermarkets is located in northern Italy (47.1 %), followed by the southern region (28.6 %), and then by the central region (24.3 %).  Convenience stores and small supermarkets are commonly located in central areas of towns and cities. Hypermarkets and supermarkets tend to be positioned within large shopping centers in suburban areas and on the outskirts of cities.

Italy’s food retail sales reached $175 billion in 2020, 5.6 % more than in 2019.  While on-line grocery shopping grew by 134.4 %, increased sales were also registered in discount stores (+8.7 %), supermarkets (+6.8 %), and grocery retailers (+5.6 %). Conversely, sales in hypermarkets (-3.4 %) were penalized by the closure of shopping centers during COVID-19 lockdown. Multi-channel strategies, blending online and in-store sales, are key to success across retailing.  Grocery retailers are paving the way towards innovative solutions in this respect, offering e-commerce shopping with deliveries to the consumer’s home and in-store lockers for customers to collect online orders. 

Most imported food products enter the Italian market through brokers or specialized traders.  Italian importers are usually small to medium-sized companies, rather than the large, market-dominating varieties found in northern Europe. Consequently, these companies import on a smaller scale, but often a broader range of products than their much larger counterparts do. Price is an increasingly important basis for import purchase decisions, although quality and novelty do move some products. Imported products from North America often enter Italy indirectly from the Netherlands’ Port of Rotterdam or directly via air.

Food and Agriculture Import Requirements

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

Leading Sub-Sectors

Italian Food Processing Ingredients Sector

The Italian food processing industry continues to be highly fragmented, and depends almost entirely on imports of raw materials, many of which come from other EU countries. Italy’s food-processing industry played a key role in 2020, with food manufacturers working relentlessly to ensure food availability, mainly to food retailers, as consumers’ demand increased rapidly, especially in the early stages of the Covid-19 pandemic. 

Stockpiling and home-cooking trends boosted sales of staple foods and cooking ingredients, such as pasta, rice, processed meat and seafood, fruits and vegetables, edible oils, sauces, dressings, and condiments. Moreover, Covid-19 accelerated Italy’s healthy eating trend, with vegan, vegetarian, and flexitarian alternatives, “free-from” products (e.g., gluten, lactose, or sugar-free), and superfoods attracting more and more local consumers. Additionally, legume-based snacks and pasta, and rich-in-protein foods were high in demand. The pandemic also strengthened the locally sourced food trend as a gesture of solidarity to local producers.

The Italian Hotel and Food Service Industry

In 2020, Italy’s consumer foodservice value sales registered a decline of 33% compared to 2019, due to the Covid-19 lockdown and restrictions across the year. The Italian Hotel and Food Service Industry is a lucrative and growing sector, but it is also diverse and fragmented. Many small establishments dominate Italy, including bed and breakfasts, youth hostels, camping facilities, resorts, and rural tourism.

Opportunities

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

Resources

Please refer to the FAS Rome webpage for information on U.S. agricultural genetics, bulk, and processed commodities, food and beverage products, market intelligence, and market sector briefs to help U.S. firms better understand the Italian market:

https://it.usembassy.gov/embassy-consulates/rome/sections-offices/foreign-agricultural-service/

Contacts for the Foreign Agricultural Service office, Rome:

Office of Agricultural Affairs

U.S. Embassy

Via Veneto 119A

00187 Rome, Italy

Tel.: +39-06-4674-2396

Fax: +39-06-4788-7008

E-mail: agrome@usda.gov