Bord Bia tells dairy exporters to look east
DAIRY EXPORTERS should look east to Indonesia, Vietnam and South Korea for new markets, research by An Bord Bia has found. Quotas on producing milk will end in 2015 and Ireland’s agri-sector’s Food Harvest 2020 plan proposes a 50 per cent increase in milk output for the dairy industry by 2020.
The Bord Bia research found that Vietnamese dairy consumption, at 14 litres per capita per annum, was very low by Asian standards but it was growing at 15 per cent a year. “The market is not sophisticated and as such presents opportunities for Irish suppliers to get into the market and develop strong positions.”
It said Indonesia imported 70 per cent of its dairy requirements. “Indonesia is the second largest importer of skim milk powder in the world after Mexico and offers significant opportunities for Irish dairy suppliers of powdered dairy ingredients.”
It noted that consumption of dairy products in South Korea was much higher than in Indonesia and Vietnam but local milk production had been in decline for a decade. Opportunities existed in the provision of whey product and dairy blends supplies, it found.
A new free trade agreement between South Korea and the EU also gave European suppliers an advantage over competing suppliers.
The Bord Bia research was novel as it included an ethnographic study. This involved the researchers visiting consumers in their homes, eating with them and in some cases staying overnight with them.
Helen King and Rory McDonnell from Bord Bia’s consumer insight and innovation team looked in people’s fridges, talked about health and diet and accompanied them to food markets and restaurants.
The study found that the market for dairy products for children was increasingly cluttered but the children’s yogurt market in Indonesia had potential for growth.
“In both markets, cheese snacking products are likely to present the greatest growth potential as one brand dominates the children’s sector.”
The researchers highlighted the opportunities for producers of low fat dairy products aimed at teenagers. They found that some parents encouraged children to stop drinking milk and reduce their intake of dairy products when they became teenagers in the belief that dairy foods “makes you fat”.
They noted also an opportunity to export dairy products with functional benefits such as brain development.