Summary:
In Q1–Q3 this year, China's sales of liquid dairy products slipped in
value terms by 2.2% YoY, attributed to reduced purchase frequency per
customer and lower average unit prices.
On
11 Dec., the Economic Daily (a Chinese state-owned newspaper) and Yili
jointly published the Q1–Q3 Dairy Products Consumption Trend Report,
with analysis of consumer data from Kantar. This shows that China's
sales of liquid dairy products (UHT/fresh milk, UHT/chilled yoghurt,
milk beverages and lactobacillus drinks) fell slightly over this period
of 2023, whilst the share made up by imported products fell still
further. The report also illustrates the market is trending towards the
healthier categories.
Weak Consumption
In
Q1–Q3, national sales of liquid dairy products went down by 2.2% YoY,
with 99.3% market penetration. Although more urban households were
consuming liquid dairy products, the purchase frequency per customer
dropped and the average unit price of liquid dairy products declined by
4.1% YoY according to data from the Ministry of Commerce as of end of
June.
Segment performances were mixed:
Ambient
liquid dairy ((UHT milk, yoghurt and milk beverages): sales down 1.1%
YoY, dropping less than the overall category average
Chilled
liquid dairy (chilled milk, yoghurt and cultured milk): sales down 6.3%
YoY, due to fewer consumer purchases; but chilled milk purchase volumes
and prices were up
By
distribution channel, sales of liquid dairy through hypermarkets and
large supermarkets fell over Q1-Q3 by 14.5% and 7.5% YoY respectively.
But sales increased in smaller stores (incl. mini markets up 13.6%,
convenience stores up 13.6%, grocery shops up 3.8%), and also in
wholesalers (up 13.1%) and online shopping platforms (up 0.4%).
Sales
of ambient liquid dairy: hypermarkets made up 16.2% (a 15.6% decline),
while mini markets and online platforms accounted for shares of 17.4%
and 15.3% (growth of 15.7% and 1.4% YoY)
Sales
of chilled liquid dairy: hypermarkets led with a share of 22.6% (but
saw a 10.9% decline); mini markets accounted for 14.9% (4.0% growth),
and online platforms accounted for 14.0% (down by 4.2%)
By
consumption region, sales in county-level cities and counties grew
faster, contributing 30.4% of sales of liquid dairy products, up by 1.0%
YoY; conversely, sales in provincial capital cities, prefecture-level
cities and Beijing, Shanghai and Guangzhou all fell.
Health Awareness Driving Segments
As
awareness of heath and nutrition issues has grown among the public,
demand grew in niche segments that feature sugar reduction, organics and
speciality proteins.
In Q1–Q3, sales of sugar-reduced yoghurt increased by 14%, in contrast with a 15.0% decrease in sales of whole sugar yoghurt
Sales of organic milk were up by 19.0%, compared with a meager 0.9% growth in non-organic milk
Sales
of milk marketed with speciality proteins grew sharply by 27%: A2 milk
up 34%, immunoglobulin milk up 57%, lactoferrin milk up 65%; while
standard milk grew only 2%.
Imports under pressure
In
Q1–Q3, locally produced liquid dairy products accounted for 97.2% of
total sales compared with imported liquid dairy products at 2.8% only in
value terms, with a significant reduction in ambient products, and
strong growth in chilled products, but from a very low base.
Table Sales of Domestic and Imported Liquid Dairy Products, Q1–Q3 2023
|
Item
|
Domestic
|
Imported
|
|
Market Share
|
YoY Change
|
Market Share
|
YoY Change
|
|
Liquid dairy
|
97.20%
|
-1.10%
|
2.80%
|
-21.30%
|
|
—Ambient dairy products
|
96.60%
|
0.10%
|
3.40%
|
-22.80%
|
|
—Chilled dairy products
|
99.50%
|
-5.80%
|
0.50%
|
105.30%
|
Source: Q1–Q3 Dairy Products Consumption Trend Report
Source:CCM
For more information,please check our Dairy Products China News.
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