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The Dominican
Republic Chooses U.S. Cheese 
By Wagner Méndez
Want a quick snack in the Dominican Republic? Go to your neighborhood colmado, or convenience store, where cheese is choice.
For 5 pesos, or 30 cents in U.S. money, the proprietor will slice off and cube chunks of cheese. This tasty, nutritious snack is a Dominican favorite and part of a growing consumer trend to choose cheese.
Citizens of the Dominican Republic like cheese so much that domestic dairies cannot meet the entire demand. Moreover, food safety concerns about domestic production have caused a clamor for imported products.
A Little History of Cheese Imports
In the 1940s, German immigrants established a dairy in the Dominican Republic. located on the north coast of the country, it produces dairy products and cheese under the "Sosua" brand. A second, perhaps even larger firm is Pausterizadora Rica in Santo Domingo; their products sell as "Rica."
In addition to these two players, there are hundreds of small cheese manufacturers producing a domestic white cheese.
Key players in the Dominican Republic’s imported cheese sector are the Netherlands, the United States, Germany and New Zealand. And the market is a growing one. In fact, cheese sales increased by almost 150 percent between 1994 and 1998.
Preliminary figures for 1999 indicate that market size is approximately 24,000 metric tons and about 13 percent of which is imported. The current import market size is $80 million and the U.S. share is 23 percent; only the Netherlands, with a 32-percent market share, is more successful.
Moreover, the market for cheese is expected to continue to grow. Dominicans eat cheese not only as a snack, but also in grilled sandwiches, on crackers, with bread and in pastries and desserts.
Cheese imports overall have been rising in the Caribbean region. Comparing the first eight months of fiscal year 1999 with the first eight months of fiscal year 2000, imports into the region rose from 1,700 metric tons to 2,100 tons.
Some of the most striking growth was seen in the Dominican Republic, where cheese imports went from 366 metric tons to 688 metric tons.
The Cheese Dominicans Choose
What cheeses find favor in this market? Yellow cheddar is popular. So, too, is queso blanco, a domestic white cheese that is usually purchased in 3- to 4-pound blocks.
The demand for U.S. cheese should continue, since people associate U.S. brands, such as Kraft and Healthy Choice, with quality.
The quality gap between imported and local cheese is still significant, but domestic producers are striving to narrow it.
Dominican
Distribution Channels
Small supermarkets and colmados sell most of the cheese, but that’s no surprise. On average, more than 80 percent of the food products in the Dominican Republic are distributed through small-scale operations.
The best method for new-to-market U.S. exporters to enter the market is through well-established local representatives. It is essential to know the distribution channels and the business culture here. Other exporters, however, should consider the joint venture format as a means to produce locally.
Although most recent orders of cheese were filled with large pieces from European suppliers and sliced to customer specifications at the point of sale, the market’s size is expanding as new players enter it.
Furthermore, the current trend is away from the larger institutional-sized orders and toward packaged goods sold directly to consumers in a higher price range.
As the market opens and some non-tariff barriers are removed or reduced, opportunities should appear for new players, such as the private labels.
Market Barriers for Cheese Imports
Price is the major constraint for imported cheese. Freight costs and high 35- percent tariff rates are typically passed along to consumers.
Per capita income is about $5,000 a year, so affordable products have a distinct advantage.
The Dominican Republic’s economy is likely to further improve– GDP is expected to register a hefty 7-percent growth this year.
Exporters should also be aware that the Dominican Republic may soon require food labels to be printed in English and Spanish.
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The author is the marketing specialist at the American Embassy in Santo Domingo. Tel.: (1-809) 227-0112; Fax: (1-809) 732-9454; E-mail: AgSantoDomingo@fas.usda.gov
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