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Emerging Markets Falter in Dairy Top 20

03 August 2015

GLOBAL – Survey results of the world’s biggest dairy companies have highlighted rocky times besetting the world’s key growth areas for dairy demand.

Agri-business analysts at Rabobank said near-term growth prospects in “many emerging markets” have deteriorated in its Global Dairy Top 20.

Main movers from last year’s report have been Lactalis moving into second for the first time, ahead of Danone. Dairy Farmers of America moved into the top five, the first new entrant to the top five in eight years, as Nestle remained number one.

The report also highlighted how buying power of US and Chinese companies had been “enhanced”.

Published every year, the survey ranks dairy companies according to dairy turnover, estimated to have grown five per cent to a combined US$ 223 billion in 2014.

Japanese companies have slid further down the list from 14 to 11 and in China Mengniu and Yili are may need to offer a “new approach” after a “remarkable rise” over the last decade.

The lesson, according to Rabobank, is that expansion is difficult in an economic downturn without pushing into offshore markets.

Rabobank’s report said: “Chinese dairy companies are now facing a new reality: slower economic growth and the maturation of several product categories has trimmed underlying volume growth and made trading up harder to achieve.

“With cost-push inflation also set to ease, reported domestic sales growth values are likely to be far slower in the next few years than they have been in the last decade.”

TheCattleSite News Desk

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