June 19, 2014


China's UHT milk imports to surge


China's demand growth for UHT milk has been surpassing other dairy categories such as infant formulas and other powders, with UHT imports more than quadrupling over the last three years to 184,000 tonnes in 2013.


Experts forecast that volumes could reach 300,000 tonnes this year.  Indeed, there appears to be ample scope for growth with imported liquid milk still only accounting for around 2% of China's liquid milk consumption.


While the overall rise in consumption is driving the growth, lack of domestic supplies and safety concerns are also contributing. Currently, domestic milk producer Yili Group is the dominant player, accounting for over 25% of the market. Germany is the leading supplier, accounting for around 42% of imports, followed by New Zealand at 18%, France at 14% and Australia at about 12%


Raw milk prices in China are amongst the highest in the world, presently about US$0.79/litre.

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