The global dairy market has been forecast to increase at a compound annual growth rate (CAGR) of 4% over the five-year period 2011 - 2016, increasing from total revenues of $298.8 billion in 2011, to total revenues of $363.9 billion by the end of 2016.
According to a recent market report, 'Dairy: Global Industry Guide,' market consumption volumes increased with a CAGR of 3.3% between 2007-2011, to reach a total of 43.7 billion kg in 2011.
After sharply increasing (2007), dramatically falling (2008) and quickly rebounding (2009), international dairy prices remained at relatively high but stable levels over much of 2010. Toward the end of the year and early 2011, global prices strengthened rapidly but stayed well below the peak levels of 2007/08 with the exception of record high butter prices (Oceania).
Popularity of dairy products, westernisation of diets and the increasing range of dairy products continue to be the key drivers underpinning dairy markets worldwide. The dairy sector remains among the fastest growing sectors. In the next 10 years, world milk production is projected to increase by 153 Mt. The majority of the growth is anticipated to come from developing countries.
After stagnating in 2009, milk production rebounded in 2010 and is expected to grow initially in excess of 2% annually for the next three years, causing prices to decline. As prices adjust downward, the growth in milk production after 2013 is expected to be less vigorous. The average annual growth for the next ten years is projected at 1.9%, compared with the 2.1% average annual growth experienced in the past decade.
The main areas forecast to see growth will be Asia Pacific and Latin America, which the more developed markets in regions such as Europe and North America will start to contract.
The main growth is going to be driven by the markets in China, which will see a nine per cent rise in the market and Brazil which will see a seven per cent rise.
Increasing population and income, together with the growing popularity of dairy products, particularly among developing country consumers is a key factor behind strong demand in the medium term.
Demand continues to be encouraged by the growing influence of retail chains and multinational companies in these countries, which is facilitating improved consumer access to dairy products. Also, in many countries consumption is enhanced by government programmes (i.e. school milk).
For more information on the global dairy market, see the latest research: Dairy Market Research
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