May 14, 2015
As Korean birth rates fall, milk powder manufacturers look to China
Low birth rates in South Korea are rendering the country as a less profitable market for its milk powder makers. In 2014, the nation recorded a birth rate of 1.21, one of the lowest among member states of the Organization for Economic Cooperation and Development (OECD).
Last week, the local weekly intake of milk powder was recorded at 13,555 tonnes. The figure dropped close to half of the 25,472 tonnes recorded two decades ago.
As a result, Korean dairy companies are now raising exports to China, according to data by the Korea Dairy Committee. With Beijing relaxing its one-child policy coupled with a favourable economic performance, the Chinese market for baby products is expected to grow as well.
Namyang Dairy Products, South Korea's first general dairy business, will be eyeing on 23 cities in China. Those areas have a per-capita gross domestic product of more than US$3,000, in addition to a population of more than one million people.
In 2014, the company's milk powder deliveries to China was worth US$20 million. The value was close to quadrupling from the US$5 million recorded in 2011.
Another firm, Maeil Dairies Industry, had also witnessed rising exports to the Mainland last year. Deliveries rose to US$31 million, from US$6.3 million in 2011.