This updated report from Access Asia provides detailed analysis of the dairy products market in China (butter, margarine, milk, cream, cheese, yoghurts and ice creams).
Historically, dairy and milk-based products were rare in China. A high incidence rate of lactose intolerance, low level of milk and dairy production, no cultural history of cheese and other dairy products combined to keep the market restricted. Add to this the mammoth transportation problems, southern climate, poor storage and packaging and dairy products were not the easiest things to produce and sell either for local or international companies. But, tastes have changed. The arrival of the fast-food chains, western-style supermarkets, greater awareness concerning the health benefits of dairy products and the emergence of a generation both willing and able to try new products and the market for dairy products has made great strides in China. Despite not being a traditional food product in China, dairy products are emerging as one of the fastest growing sectors of the market in China at the moment. There are any number of reasons for this – calcium awareness, a growing taste for western products, improved earnings, increased availability – amongst them. Not least is the presence of foreign dairy companies, both as active importers in to the market and latterly as manufacturers in China. The new Zealand Dairy Board was so pleased with import success that it has now opened a factory. Walls and Nestlé have come to dominate the ice cream and popsicle markets due to lack of local competition. There are currently approximately 1,000 dairy enterprises in China, of which 90% have a capacity of processing less than 100 tons of fresh milk daily. Many dairy farms have increasingly outdated equipment and technology despite growing levels of investment and this is meaning that they are losing out to foreign funded joint ventures and imports.