China Dairy - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The China Dairy Market size is estimated at USD 73.66 billion in 2024, and is expected to reach USD 91.20 billion by 2029, growing at a CAGR of 4.36% during the forecast period (2024-2029).

Expanding street food culture and rising out-of-home consumption fuels the market growth

• The off-trade channel plays a major role in the sales of dairy products in the region. Among the off-trade channels, supermarkets and hypermarkets are the largest distribution channels in the Chinese dairy market. The proximity factor of these channels, especially in large and developed cities, provides them with an added advantage in influencing consumers' decisions to purchase among the large variety of products available in the market. In 2023, supermarkets and hypermarkets accounted for 64% of the value share.
• The online channel is expected to be the fastest-growing distribution channel in the off-trade segment. It is projected to register a growth value of 22.4% Y-o-Y during the period 2023-2025. Convenience is the primary motivation for shoppers who have transitioned to shopping for groceries online.
• The expanding street food culture across China is anticipated to drive the on-trade consumption of dairy products like cheese, butter, and dairy desserts during the forecast period. Fast food brands, including Subway, McDonald's, Burger King, and KFC, dominate the landscape for restaurant franchises in the country. The sales value of dairy products through the on-trade channel is anticipated to grow by 9.7% in 2025 from 2022.
• Among all the dairy products, milk accounted for the majority of the share in overall off-trade retail channels. In 2022, milk accounted for 54.5% of the total category, and yogurt stood in second place with 38% of the value share. The strong consumption patterns of dairy products and their demand in a regular diet are anticipated to drive the consumption patterns of these products through both off-trade and on-trade modes. Dairy consumption through the off-trade channel is anticipated to grow by 29% during 2024-2027.

China Dairy Market Trends

Growing health awareness in the country boosting the consumption of dairy and dairy products

• Consumer preference is influenced by food-based dietary guidelines, which suggest the consumption requirements of dairy. The Dietary Guidance for Chinese Residents recommends a daily intake of 300 grams of dairy products on a fluid milk basis, indicating the potential for continued growth in dairy consumption in the country. Raw milk production is mainly concentrated in northern China, followed by southern and eastern China.
• Cheese is popular among the dairy products consumed due to strong demand from restaurants as there is an inclination toward Western-style food like pizza, burgers, pasta, sandwiches, and tacos. The per capita consumption of cheese is estimated to increase by 7.10% from 2023 to 2024.
• Growing health consciousness among consumers is also boosting dairy consumption in China, especially post the COVID-19 outbreak. China Customs indicated that China bought 176,000 metric tons of cheese from foreign countries in 2021, up by 36.3% from 2020, with New Zealand, Australia, and Denmark as the top three exporters.
• Owing to the increasing per capita yogurt consumption, companies are focusing on developing yogurt products with gluten-free and non-GMO claims. Plain yogurts are also available in non-fat, low-fat, and whole-milk variants, as per consumer choice, and can be used in dips, smoothies, and baked foods. Pasteurized milk and yogurt were added to the National School Milk Program in 2021, which supports the demand for these products.
• The changing lifestyles of consumers and eating habits are boosting the demand for ready-to-use products such as milk powder due to the associated convenience factor. The per capita consumption of milk powder is estimated to increase by 1.14% from 2023 to 2024.

China Dairy Industry Overview

The China Dairy Market is moderately consolidated, with the top five companies occupying 47.36%. The major players in this market are Bright Food (Group) Co. Ltd, China Mengniu Dairy Company Limited, Inner Mongolia Yili Industrial Group Co. Ltd, Nestle SA and Want Want Holdings Limited (sorted alphabetically).

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