July 14, 2010

Dairy industry eyes growth in global demographic shift

Changing demographics will have an impact on the types of dairy products people consume and how they consume them, providing new growth opportunities for the dairy industry, according to the latest edition of the Tetra Pak Dairy Index.

Ageing populations, urbanisation and an emerging global middle class are driving demand for new types of liquid dairy products (LDP) in both developed and developing countries, reports the Tetra Pak newsletter, which tracks worldwide facts, figures and trends in the global dairy industry.

Tetra Pak President and CEO Dennis Jönsson said, "The population in many countries will have more time, money and education than ever before. They'll also be more active and vibrant. As people live longer, they also plan their lives differently. Dairy producers who can meet the changing needs of this demographic segment will realise significant growth opportunities."

Kandarp Singh, marketing & product management director of Tetra Pak South Asia markets, said "Carton milk continues to see strong growth in its early stages of entry in the Indian market - we are very optimistic that this trend will only accelerate, in fact, to the point that maintaining supply could become a challenge."

Worldwide consumption of milk and other LDP is expected to grow at a compound annual growth rate (CAGR) of 2.4% from 2009 to 2012 - reaching 283 billion litres. This is up 0.2 percentage points compared to the previous forecast of 2.2% CAGR. Worldwide LDP consumption increased on-year by 1.8% to 264 billion litres and demand has continued to be strong through the first half of 2010.

Driven primarily by ready to drink (RTD) ambient (or long-life) LDP - with a forecasted CAGR of 5.4% from 2009 to 2012 - global LDP consumption is expected to reach 283 billion litres by 2012. The strongest growth in the RTD ambient LDP category is expected to come from Asia Pacific (8.7% CAGR), Latin America (7.1% CAGR) and Africa (6.9% CAGR).