Dairy sales slump, domestic market enters a hard-to-sell year
The arrival of the dairy industry's harsh winter is not only reflected in the decline of the financial figures of major dairy companies; the markedly slowing growth of each subcategory in the industry also illustrates the difficulties faced by the domestic dairy products market in 2015. Data from a third party shows that, compared with 2014, whether by total volume or by overall category growth, the sales growth rate of dairy products from January to September 2015 was lower than in the same period last year.
Taking the liquid milk market, the most important in the industry, as an example, in the first three quarters of this year liquid milk sales reached 102.4 billion yuan, with the overall category maintaining 5% growth. However, in the same period of 2014, liquid milk sales grew 12.8% year on year, and this year the growth rate has fallen to less than half. On the channel side, it is worth noting that convenience store sales showed a year-on-year increase of 11.9%, already ahead of the growth rates of supermarkets and hypermarkets, which also provides a reference for dairy companies' channel reforms.
The various dairy product subcategories also performed differently. For example, compared with the same period last year, in the first three quarters of this year ambient yogurt, fresh yogurt and lactic acid bacteria drinks showed positive growth, among which ambient yogurt grew the most, reaching 106.3%. Although this figure is lower than the 108.9% growth of the same period last year, it is already far higher than the positive growth of 10.5% for fresh yogurt and 7.4% for lactic acid bacteria drinks. Industry insiders believe that the involvement of several leading dairy companies will rapidly expand the ambient yogurt category, and will also attract more companies to follow suit in the future.
In addition to the growth of the above categories, ambient liquid milk, sour milk and low-temperature fresh milk showed negative growth. Most notably among the three, low-temperature fresh milk still grew 25.2% in the same period last year, but in the first three quarters of this year it showed a change of -10.2%. In this regard, industry insiders believe this is related to the high base caused by the large growth of low-temperature liquid milk last year as well as the overall weak dairy consumption environment. Although negative growth appeared this year, industry insiders believe that low-temperature liquid milk will still experience explosive growth in the future.
Although the various dairy product subcategories each performed differently, all categories showed slowing growth, which further illustrates that dairy consumption has shown obvious weakness this year. In addition, the shift of consumer attention to other multiple categories and overseas has also diverted part of the domestic dairy product sales market. Previously, Song Kungang, honorary chairman of the China Dairy Industry Association, said that the domestic dairy products market will in the future be more affected by the international market, and it is also urgent for companies to accelerate the pace of product structure adjustment.