Move to boost dairy industry

  • AseanPlus News
  • Saturday, 12 Feb 2005

CHINA hopes to boost the global dairy industry over the next 10 to 15 years, thanks to the growing consumption of milk and other dairy products in the world’s most populous nation.  

With 1.3 billion people but only 13% of the world average milk consumption, China is very likely to help increase the global dairy output by expanding production to meet its own demands, said Wang Huaibao, vice director of China Association of Dairy Products Industry.  

China’s dairy production has been posting double-digit growth annually since its reform and opening up in the late 1970s. It presently produces 16.25 million tons of dairy products a year, said Wang.  

The country also enjoys price advantages compared with many developed countries. In 2000, the most recent year that data is available, the cost per kilo for fresh milk in China was 45% lower than what was reported in North America and the European Union, he said.  

But China’s per capita consumption of dairy products is only 13kg a year, much lower than the average 300kg reported in the developed countries and the world average of 100kg, according to Wang. “There’s massive potential in the Chinese market,” he said.  

With the sustained growth of China’s economy and betterment of the people’s life, Wang estimated China’s per capita annual consumption of dairy products will increase to 18kg by 2015.  

The country’s dairy production, in the meantime, will grow at six to nine percent per year to top 25 million tons in 2015, he estimated.  

The world’s milk production has seen sluggish growth between one to two percent over the past decade and the United Nation’s Food and Agricultural Organization says the current production is around 594 million tons.  

The UN organisation has attributed the industry’s slowdown to restrictions on milk production from developed countries that together produce 71.7% of the world’s dairy output.  

Meanwhile, sustained growth reported in the dairy industry in Asia, Latin America and Oceania is mostly offset by declining production in East Europe and the Commonwealth of Independent States, say analysts with the organization.  

They say Asia and Latin America, which have booming demands for dairy products, will continue to contribute to global milk production in the coming decade.  

But Wang warned domestic dairy producers to remain clear-headed and avoid hasty expansion in the current heated market. “We have to remember that many people in China are not yet ready to include milk in their diet,” he said. “Most of the country’s 9 million farmers never drink any because they don’t like it or can’t afford it.”  

- China Daily 

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