Food Pacific Manufacturing Journal

Just how far have Asia's milk makers come in the past decade? Rabobank International's Global Dairy Top 20 shows the inclusion of Japan and China in the world dairy sector. Reflecting the growth of the market, the Japanese contenders Meiji Dairies moved up three places to number 11 and Morinaga was in 14th place, and China's Yili shot into the rankings for the first time at number 17 and Mengniu kept its ranking at 16 (attained last year). Whilst Japan is a mature market (by Asian standards) that may have reached its peak dairy per capita consumption at around 60 litres per year, China is a very young market that has had almost no history of milk consumption. So the ascension of Mengniu and Yili into the top ranks of global dairy players is especially remarkable given that just five years ago, milk consumption in the Mainland was negligible. Today, per capita consumption is about 20 litres per year, and this is forecast to grow to 50 litres in another five years. That may seem like a drop in the milk bucket when compared to the 300 litres of dairy products consumed per person per year in the Netherlands, but we are talking about over a billion Chinese consumers here. Changing diets and strength in numbers are key to understanding the growth of demand in the Asian markets, according to Mark Voorbergen of Rabobank's Food & Agribusiness Research and Advisory. "The Chinese government is helping create a whole new generation of dairy consumers by promoting a school milk programme. So Chinese dairy companies will have ample opportunity to increase sales simply by keeping up with domestic market growth." Don't discount the other emerging markets in Asia. Dairy giant Fonterra is focusing its efforts on the region because it expects global consumption of UHT to increase at a compound annual rate of 5.2% through to 2012, with much of this growth is coming from Asian markets such as Malaysia, Indonesia and Viet Nam. In a reverse of that move, Vinamilk of Viet Nam is investing in a Kiwi milk company to assure its raw material supply for both it domestic and export markets.