Dairy producers in both developed and emerging dairy markets need to address the careful balancing act required to ensure sustainable business success, according to Tetra Pak’s 7th Dairy Index.
The report reveals that global demand for milk is set to surge by 36% in the next decade, largely due to population growth, rising prosperity and urbanization in Africa, Asia and Latin America.
However, milk supply and demand is imbalanced across the world – rising demand in emerging dairy markets is unlikely to be fulfilled by locally produced raw milk, while developed dairy markets producing a milk surplus face the challenges of competing for the export and responding to falling domestic consumption.
“The predicted surge in global demand offers a huge opportunity for dairy companies in developed markets to export powder and ambient liquid dairy products to growing economies,” says president and CEO Dennis Jönsson.
“However, to ensure long-term success, these producers need to balance the ‘quick wins’ of export against the requirement to continue to grow their domestic markets.”
“Meanwhile, dairy companies in import markets must overcome the challenge of securing a sustainable, high quality milk supply while keeping pace with growing demand” he says.
“Markets such as China and Saudi Arabia are doing so in multiple ways: increasing investment in domestic dairy farming, partnering with well-established foreign companies, and diversifying their offer with value-added products.”
“Fundamentally, these are measures that will help to achieve the vital balancing act of shoring up the future of a sustainable dairy industry.”