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:
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%).
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.
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.
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:CCM
For more information,please check our Dairy Products China News.
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