In H1 the Chinese dairy industry
has progressed well, according to data from the Dairy Association of China
(DAC). These show the total output of dairy products at 11.5 million tonnes in H1,
up by 6.6% compared with the same period in 2011. From this volume, 9.7 million
tonnes (84.3%) comprised liquid milk products, a category which increased by
7.3%. It is likely that the total output of dairy products in 2012 will exceed
the 23.9 million tonnes seen in 2011, according to CCM International’s July
issue of Dairy
Products China News.
The key production area remains
Inner Mongolia Autonomous Region (IMAR), which produced 250,000 tonnes of dairy
products (of which 200,000 tonnes of liquid milk products) in June. Overall its
output stood at 1.56 million tonnes (1.27 million tonnes liquid) in H1. The
region’s volumes went down and are counter to the overall trend, likely
reflecting its reliance on WMP, a product category badly hit by the declining
consumer confidence in local product.
The other leading regions are
Hebei, Shandong and Heilongjiang. Shandong is the standout, with much the
strongest development of these key areas – up 16.5% overall and 20% in liquid
milk products compared with H1 2011.Strong milk supply appears to be a key
factor driving the growth in Shandong’s figures: the province had 1.42 million
cows and produced 4.6 million tonnes of milk in 2011, accounting for 12.6% of
national production. Moreover 44% of dairy farms had 200+ head.
Strong milk supply growth has
been a factor behind the rising output: the Ministry of Agriculture puts
production at 15.7 million tonnes in H1, representing growth of 3.6% compared
with H1 2011. This is timely but will not meet demand, as many of the larger
dairy enterprises such as Bright Dairy, Yili and Mengniu have expanded their
production capacity in 2011-2012. Producers have been encouraged by stable milk
prices and the supply growth reflects a series of government policies geared
toward promoting the development of commercialscale production, such as the
12th 5-Year Development Plan of the Livestock Industry (please see Dairy
Products China News Vol.4 Nov. issue, p11).
The latest figures seem to fit
with the data released in late April by the China Economic Monitoring and
Analysis Centre (CEMAC, part of the National Bureau of Statistics of China or
NBSC). Its “Prosperity Index” (calculated from a variety of economic data on
the domestic dairy industry’s performance) stood at 99.4 for Q1 2012, up 0.2
over Q4 2011. This seems significant: during that last Q the Index was 98.5,
down 0.2 from the Q3 figure of 98.7 – this had been the first decline in 2011.
The Index seems likely to keep increasing given the work being put in by
processors and governments to improve the management of food safety.
China’s consumption of liquid
milk products has been widely reported as likely to reach 23 million tonnes in
2012, an increase of 2 million tonnes over 2011, so the local output growth is
meeting a growth market, albeit one with increasing international competition.
But at 6.6% the growth rate of overall dairy industry output in H1 is lower
than the 13.9% (to 10.8 million tonnes) achieved in H1 2011, according to the
data from DAC. A similar situation is expected during H2 this year, potentially
challenging many local dairy enterprises as they seek to make the most of the
booming market.
Meanwhile import demand remains
strong.
Content of Dairy Products China News 1207:
Dairy
Industry Growth in H1
Signs of
the Growing Cheese Market
Strengthened
Supervision + Increasing Concern = More Food Incidents
Government
Plan for Build Food Safety Supervision System
New
Website for Quality Management of Food Enterprises
Arla
Foods + Mengniu + Biostime: Cooperation Arrangements
Junlebao
Dairy Cooperation with BOC
Pengxin
Targets Domestic Raw Milk
Dairy
Industry Benefits from the Development of Grassland
Tianyou
Dairy Launches New Yoghurt
Dumex
Launches New Formula
Dairy
Products China News,
a monthly publication issued by CCM International on the 30th/31st of every
month, brings you the latest information on new market dynamics, company
dynamics, new dairy products and consumption trend, new legislations and
policies and raw milk supply dynamics that are shaping the market.
About CCM
International
CCM International is dedicated to market research in China
CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606
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