Research Report on Market of Raw Material Milk Powder in China

 Published On: Jul, 2016 |    No of Pages: 106 |  Published By: Beijing Orient Agribusiness Consultant Ltd | Format: PDF
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This report focuses on the current status and foreseeable trend of China’s raw material powder market. Apart from quoting official data from both the Chinese Government and foreign countries, more importantly this report is based on data from actual field surveys done by our researchers. There is combination of case studies and field surveys which include both field and telephone interviews. The interviewees include whole powder importers and import agents; dairy producers, milk drink producers, ice cream producers, bakery producers and soy milk powder producers; and relevant associations. The contents of the report are: overview of China’s raw material powder industry, policy environment of raw material powder industry, import and export of raw material powder, market pattern of raw material powder and growing trend, market capacity of raw material powder and major players, margin of raw material powder industry and trend of raw material powder market. This report is composed by senior researchers who have profound knowledge on China’s dairy industry or the world dairy industry. It is believed this report is important reference to domestic and foreign producers, investment agencies and relevant researchers that intent to understand and explore China’s raw material powder market.   

Research Background
Raw material milk powder (including whole powder and skim powder) is the mainstream of dry dairy products in China. As an important milk-based raw material , raw material powder is widely used in formula powder, milk drink, reconstituted milk, soy milk powder, ice cream, bakery and daily chemicals. China is a primary producer of raw material powder (mainly whole powder) in the world, the annual production is close to 1 million tons, but at the same time China is also the largest raw material powder consumer in the world, its annual consumption is above 1.5 million tons. Neither the quality nor the quantity of domestic made raw material powder can meet the rising demand. China’s raw material powder industry went through ups and downs, the peak was from 2006-2007, there was prosperous demand for raw material powder (especially whole powder) at the international market, China’s production broke the historical record and raw material powder price kept on surging. During the same period of time, lots of capital entered into the raw material powder industry thanks to the growing demand, and there was unprecedented acceleration of new construction and expansion of production capacities. 2008 saw sluggish demand for raw material powder at the international market, especially the melamine incident was a serious blow to China’s raw material powder industry. Domestic made raw material powder encountered a serious reputation crisis, whereas imported products gained unprecedented preference. Although the reputation of domestic made raw material powder recovered to a certain extent in recent years after rectification, yet import of raw material powder continued to break the record since domestic made products were at a much inferior position in cost performance, especially import from New Zealand hit the trigger level earlier and earlier. In the past decade, both the production and sales of raw material powder has been growing on the whole in China, but there were sharp fluctuations. Owing to the extensive demand for raw material powder in China, plus the enhancing dependence on import by domestic consumers, domestic made powder is unable to meet the demand and hence there is a big growing potential.

This report focuses on the current status and foreseeable trend of China’s raw material powder market. Apart from quoting official data from both the Chinese Government and foreign countries, more importantly this report is based on data from actual field surveys done by our researchers. There is combination of case studies and field surveys which include both field and telephone interviews. The interviewees include whole powder importers and import agents; dairy producers, milk drink producers, ice cream producers, bakery producers and soy milk powder producers; and relevant associations. The contents of the report are: overview of China’s raw material powder industry, policy environment of raw material powder industry, import and export of raw material powder, market pattern of raw material powder and growing trend, market capacity of raw material powder and major players, margin of raw material powder industry and trend of raw material powder market. This report is composed by senior researchers who have profound knowledge on China’s dairy industry or the world dairy industry. It is believed this report is important reference to domestic and foreign producers, investment agencies and relevant researchers that intent to understand and explore China’s raw material powder market.
1. Overview of Raw Material Milk Powder and Processing Industry 10
1.1 Raw Material Milk Powder and Products 10
1.1.1 Definition 10
1.1.2 Types and Processing Techniques 10
1.2 Raw Material Milk Powder Processing Industry in the World 11
1.2.1 Production and Layout  11
1.2.2 Consumption  14
1.2.3 International Trade  15
1.2.4 Price Trend 19
2. Policy Environment for Raw Material Milk Powder Processing Industry 23
2.1 National Quality and Safety Standards 23
2.1.1 Raw Milk 23
2.1.2 Raw Material Milk Powder 24
2.2 Industrial Policy for Dairy Processing  25
2.2.1 Industrial Layout  25
2.2.2 Threshold  26
2.3 New Supervision Regulations over Raw Material Milk Powder 26
2.3.1 Circular on Further Strengthening Dairy Quality/safety Work 26
2.3.2 Test, Quarantine and Supervision over Dairy Import and Export 28
3.Overview of China’s Raw Material Milk Powder Market 32
3.1 Dairy Farming and Raw Material Powder Processing  32
3.1.1 Dairy Farming 32
3.1.2 Raw Material Powder Processing 34
3.2 Trade  36
3.2.1 Trade Policy  36
3.2.2 Overview of the Trade 38
3.2.3 Import  38
3.2.4 Export 41
3.3 Factors Affecting Production and Trade 42
3.3.1 Melamine Incident 42
3.3.2 Raw Milk Price 43
3.4 Market Capacity and Growing Trend 44
3.5 Future Development 45
4.Application of Raw Material Powder in China 47
4.1 Overview 47
4.2 Milk Drinks 48
4.2.1 Formulated Milk Drink 48
4.2.2 Fermented Milk Drink 48
4.2.2 Other Drinks with Milk Content 48
4.2.3 Raw Material Powder Demand 48
4.3 Formula Milk Powder  49
4.3.1 Infant Formula  49
4.3.2 Adult Formula  50
4.3.3 Other Flavored Milk Powder 51
4.3.4 Raw Material Powder Demand 51
4.4 Reconstituted Milk 51
4.4.1 Reconstituted Yogurt 52
4.4.2 Reconstituted Milk 52
4.4.3 Raw Material Powder Demand 52
4.5 Soy Milk Powder  53
4.5.1 Production and Consumption 53
4.5.2 Raw Material Powder Demand 53
4.6 Ice Cream 53
4.6.1 Production and Consumption 53
4.6.2 Raw Material Powder Demand  54
4.7 Bakery 54
4.7.1 Production and Consumption  54
4.7.2 Raw Material Powder Demand 55
4.8 Other Application  55
5.Margin of Raw Material Powder Processing in China 56
5.1 Production Cost 56
5.2 Gross Profit  56
5.2.1 Break-even Point  56
5.2.2 Margin 57
6. Competition of Raw Material Powder Market in China 58
6.1 Producers  58
6.2 Top 10 Producers 58
7. Importers of Raw Material Powder in China 75
7.1 Light Whole Powder Importers 76
7.1.1 Foreign-funded Trading Companies 77
7.1.2 Top 15 Foreign-funded Producers 78
7.1.3 Domestic Trading (Logistics) Companies 79
7.1.4 Top 10 Domestic Producers  79
7.2 Sweet Whole Powder Importers 80
7.2.1 Supplying Countries of Sweet Whole Powder 80
7.2.2 Top 10 Importers 80
7.3 Skim Powder Importers 81
7.4 Raw Material Powder Import from New Zealand 85
7.4.1 Overview of Import  85
7.4.2 Importers that Import Raw Material Powder fromNew Zealand 87
7.4.3 Restraint and Prospect of Import from New Zealand 88
7.5 Raw Material Powder Import from 84
7.5.1 Importers that Import Raw Material Powder fromAustralia 84
7.5.2 Importers that Import Raw Material Powder from Australia 86
7.5.3 Restraint and Prospect of Import from Australia 87
8.Advice from BOABC on Operational Strategy and Measures in China’s Raw Material Powder Market 92
8.1 Barriers and Opportunities of China’s Raw Material Powder Market 92
8.1.1 Barriers for Entering into Raw Material Powder Processing Industry 92
8.1.2 Opportunities in Raw Material Powder Market 93
8.2 Advice on Operational Strategy and Measures for Entering into and Exploring China’s Raw Material Powder Market 94
8.2.1 Implementation of “Blue Sea Strategy” and Exploration of High Value-added Products  94
8.2.2 Implementation of Brand Strategy and Grabbing Top-end Market 94
8.2.3 Reduction of Operational Risks by Combining with Other Processed Dairy Products 95
8.2.4 Active Exploration of International Market and Extension of Market Space 96
Attached Table  97

Attached Table 1: Importers of Whole Powder (over 1,000 tons import), 2015 100
Attached Table 2: Importers of Skim Powder (over 500 tons import), 2015 105
Attached Table 3: Top 50 Importers of Whole Powder, 2015 106

FIGURES AND TABLES

Fig. 1-1 Processing Technique of Sweet Whole Powder 10
Fig. 1-2 Processing Technique of Skim Powder 10
Fig. 1-3 Production Layout of Whole Powder around the Globe, 2014 11
Fig. 1-4 Production Layout of Skim Powder in the World, 2014 13
Fig. 1-5 Average FOB Trend of Whole Powder and Skim Powder in Europe and Oceania, 2009-2015 20
Fig. 1-6 FOB Trend of Whole Powder and Skim Powder at Fonterra Online Trading Platform, 2012-2015 20
Fig. 1-7 Global Average FOB Trend of Raw Milk, 2008-2015 21
Fig. 3-1 Changes of Dairy Cattle Inventory in China, 1997-2015 31
Fig. 3-2 Regional Layout of Raw Milk Production in China, 2015 32
Fig. 3-3 Average Raw Milk Price Trend in the Northern 10 Dairy Farming Provinces, 2008-2015 33
Fig. 3-4 Trend of Whole Powder Production in China, 1999-2014 33
Fig. 3-5 Regional Layout of Whole Powder Production in China, 2014 34
Fig. 3-6 Trend of Skim Powder Production in China, 1999-2014 35
Fig. 3-7 Trend of Raw Material Powder Trade in China, 2007-2015 37
Fig. 3-8 Supplying Countries of Skim Powder to China, 2015 38
Fig. 3-9 Average Raw Material Powder Import Price to China, 2010-2015 39
Fig. 3-10 Trend of Raw Material Powder Export from China, 2010-2015 40
Fig. 3-11 Destinations of Powder Export from China, First Five Months, 2015 41
Fig. 3-12 Raw Milk Price in China vs Global Average, 2008-2015 42
Fig. 3-12 Changes of Per Capita Powder Consumption of Chinese Urban Residents, 2004-2014 43
Fig. 3-13 Structure of Dairy Products in China, 2014 44
Fig. 4-1 Application of Raw Material Powder in China, 2014 46
Fig. 4-1 Changes of Production of Infant Formula in China, 2000-2014 49
Fig. 5-1 CIF for Whole Powder Import to China, 2009-2015 57
Fig. 6-1 Regional Layout of Whole Powder Production in China 58
Fig. 6-2 Dairy Farming of Beijing Shuangwa Dairy Co., Ltd. 61
Fig. 7-1 Types of Importers of Light Whole Powder in China, 2015 76
Fig. 7-2 Types of Importers of Skim Powder in China, 2015 81
Fig. 7-3 Trend of Production and Export of Whole Powder in Australia 85
Fig. 7-4 Trend of Production and Export of Skim Powder in Australia 86
Fig. 7-5 Export Markets of Skim Powder from Australia  86
Fig. 7-6 Import Price for Raw Material Powder from Australia, by Month, 2010-2015 87

Table 1-1 Whole Powder Production by Key Countries, 2014 11
Table 1-2 Whole Powder Production by Some Countries (regions), 2011-2015 12
Table 1-3 Skim Powder Production by Key Countries, 2014 13
Table 1-4 Skim Powder Production by Some Countries (regions), 2011-2014 14
Table 1-5 Whole Powder Consumption by Some Countries (regions), 2011-2014 14
Table 1-6 Skim Powder Consumption by Some Countries (regions), 2011-2014 15
Table 1-7 Whole Powder Import by Some Countries (regions), 2011-2014 16
Table 1-8 Whole Powder Export by Some Countries (regions), 2011-2014 16
Table 1-9 Raw Milk Supply in New Zealand, 2012-2014 17
Table 1-10 Supply and Demand of Whole Powder in New Zealand, 2012-2014 17
Table 1-11 Export Markets of Whole Powder from New Zealand, 2007-2014 18
Table 1-12 Skim Powder Import by Some Countries (regions), 2011-2014 18
Table 1-13 Skim Powder Export from Some Countries (regions), 2011-2014 19
Table 2-1 Sensory Requirement 22
Table 2-2 Physical and Chemical Index  22
Table 2-3 Microorganism MRL 23
Table 2-4 Sensory Requirement 23
Table 2-5 Physical and Chemical Index 23
Table 2-6Microorganism MRL 24
Table 3-1 Raw Milk Production in the 10 Key Dairy Farming Provinces, 2015 32
Table 3-2 Import Quantity with Produce Agreement Rate in 2014 and Import Quantity up to the Trigger Level in 2015 35
Table 3-3 Supplying Countries of Whole Powder to China, 2002-2015 38
Table 3-4 Destinations of Imported Powder in China (by quantity), 2015 39
Table 4-1Market Size of Some Foods in China, 2014 46
Table 4-2 Production of Infant Formula by Key Producers in China, 2014 49
Table 6-1 Production of Key Products of Wondersun Dairy, 2008-2014 59
Table 6-2 History of Beijing Shuangwa Dairy Co., Ltd. 61
Table 6-3 Table of Profit of Yili (merged), 2010-2014 62
Table 6-4 Portfolios of Products of Yili 63
Table 6-5 Production of Key Products of Yili, 2008-2014 64
Table 6-6 Production of Key Products of Heilongjiang Dairy Group, 2008-2014 66
Table 6-7 Revenue of Feihe Dairy, by Quarter, 2010-2014 67
Table 6-8 Production of Feihe Dairy, 2009-2014 68
Table 6-8 Production of Nestle (China), 2009-2014 69
Table 6-9 Production of Key Products of Yaolan Dairy, 2008-2014 70
Table 6-10 Production of Key Products of Shandong Dezheng Dairy, 2008-2014 71
Table 6-11 Production of Key Products of Xi’an Yinqiao, 2008-2014 74
Table 7-1Import Size of Raw Material Powder of Main Importers in China (over 5,000 tons), 2015 75
Table 7-2 Top 10 Foreign-funded Trading Companies in Import of Light Whole Powder, 2015 77
Table 7-3 Top 15 Foreign-funded Processing Companies that Import Light Whole Powder, 2015 78
Table 7-4 Top 20 Domestic Trading (logistics) Companies in Import of Light Whole Powder, 2015 79
Table 7-5 Top 10 Domestic Producers that Import Light Whole Powder, 2015 80
Table 7-6 Top 10 Importers of Sweet Whole Powder, 2015 81
Table 7-7 Import of Skim Powder by Key Foreign-funded Trading Companies, 2015 82
Table 7-8 Top 15 Foreign-funded Processing Companies That Import Skim Powder,  2015 82
Table 7-9 Top 20 Domestic Trading (logistic) Companies that Import Skim Powder, 2015 83
Table 7-10 Top 10 Domestic Producers that Import Skim Powder, 2015 84
Table 7-12 Raw Material Powder Import from Australia and New Zealand by China, 2007-2015 86
Table 7-13 Top 10 Importers of Skim Powder from New Zealand, 2015 87
Table 7-14 Top 10 Importers of Light Whole Powder from New Zealand, 2015 88
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