Non-PDO halloumi makers could end up in court

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Cyprus authorities will be taking legal action against cheese makers who continue to produce and sell halloumi which does not comply with the criteria set out in the newly adopted PDO file.

Commenting on a failure to see eye to eye with dairy producers and livestock breeders over what defines halloumi, Agriculture Minister Costas Kadis said that the island’s legal services have been instructed to chase violators.

Halloumi’s ‘product of designated origin’ (PDO) status, approved in April 2021 by the European Commission, means the rubbery cheese can only be produced in Cyprus, under strict criteria, preventing imitators worldwide from claiming the crown.

Kadis told CyBC state radio that no dairy producer has so far adapted to the criteria, clinging instead to the requirements set out by the European Union trademark.

The thorny issue for producers is the ratio of cow-to-sheep or goat milk. Local cheesemakers have even challenged halloumi’s newly acquired PDO status in court, as they argued that tight criteria would unavoidably mean loss of exports and decreased production.

Cyprus’ PDO file submitted in 2014 said goat’s milk should by 2024 exceed cow’s milk, reaching a minimum of 51%, produced from specific Cypriot breeds of goats and sheep; this did not satisfy cheesemakers who fear the loss of halloumi exports.

On the other hand, sheep and goat breeders want to ensure that all their milk will be bought by by the island’s dairy industry.

Talking to CyBC, Kadis recalled that the ministry had responded to the challenges posed and tabled what was thought to be a ‘win-win’ formula for all sides. The formula, if agreed, was to be submitted to Brussels in order to tweak halloumi’s PDO file to the liking of local stakeholders.

Based on new proposals tabled by the Agriculture Minister, the thorny issue of the milk ratio was reportedly addressed to everyone’s liking.

Amendments also relate to changes in the shape and weight, animal breeds, and moisture content.

The sheep and goat milk ratio was to decrease from 50+% to 20%, while also including various halloumi by-products not included in the initial PDO file.

Subsidy for milk price

If the sheep and goat breeders accept the ‘deal’, they will see an increase in the milk price they deliver to dairies, subsidised by the government and dairy producers.

The increase for 2022-2023 is 18c per litre for sheep’s milk and 13c in the case of goat’s milk.

At present, the average price of sheep’s milk is €1.05 per litre and goat’s milk is €0.70.

“From the moment that sides have not sent us their response to our proposal, we have no other option but to withdraw any intention of requesting changes to the PDO file and carry out checks to ensure that producers are abiding by the file’s criteria,” said Kadis.

“We’re waiting for the legal services and the Commerce Ministry to deliver their verdict on whether local producers can make halloumi under the EU trademark and what implications this may have on the cheese’s prospects,” he noted.

Kadis said that each case will be treated differently, as producers are violating the file’s criteria to different extents – from not conforming with the obligation to sell the squeaky cheese in blocks of 300 gr, to not sticking to the designated ingredients and recipe.

The minister said that he intends to seek the assistance of the Bureau Veritas international certifying authority tasked with verifying whether halloumi products are PDO-compliant.

“I assure you that Bureau Veritas is already performing checks at the farms and the producers’ facilities”.

EU trademark

A source close to the dairy industry told the Financial Mirror that producers maintain their right to produce halloumi under the EU trademark, which doesn’t foresee that the traditional cheese should be made with more goat’s than cow’s milk.

“If the PDO file is not amended, and the milk ratio adopted to the island’s realities, then producers will also be taking their own legal measures,” added the source.

In October, the Cyprus Cheesemakers Association and 11 other applicants appealed to the EU’s General Court of the Court of Justice, arguing it should annul the Commission’s decision to enter halloumi/hellim into the register of protected designations of origin and protected geographical indications.

The appeal was based on technicalities, but the reason is that it will dent the €300 mln in exports of the famous cheese.

Cheesemakers said they were ‘forced’ to take action as adoption of the file will endanger halloumi exports due to the ‘tight’ criteria.

According to the industry source, several appeals against Cyprus’ halloumi PDO file are pending before local and EU Courts.

In recent years, sales and exports of halloumi have spiked with 2020 bringing in a whoping €266.5 mln.

Dairy producers argue that a shortage in goat and sheep milk makes it next to impossible to produce halloumi in the quantities they are accustomed to.

The PDO file also specifies that goat’s milk used in the mix should be from local goat tribes, fed with specific animal fodder.

It also foresees that halloumi should have a designated amount of mint and can only be sold in the shape of folded blocks.

Last year, the Agriculture Ministry valued the global halloumi cheese market at €420 mln, while studies show the market could generate over €625 mln in several years.

According to Dublin-based Researchandmarkets.com, the halloumi market is projected to nearly double in six years to reach $737.0 mln by 2027, registering a compound annual growth rate (CAGR) of 10% from 2021 to 2027.