Dairy Industry – The State & Development Tendencies

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Due to the rapid development of new technologies and approaches in the world economy, investments are among the most important means of ensuring progressive changes and improvements in any industry. The “rule” also refers to the dairy industry. At the present stage, there is a number of features that significantly affect the development of the dairy market. These are large volumes of production; dependence on the state and development of agriculture; scientific and technological progress; quality and competitiveness of products, as well as many other factors.

State of the Industry

A special feature of this market is determined by the mass consumption and social significance of the product. It is also about the level of state regulation where the production is carried out (through the production quotas, import duties, sanitary and phytosanitary measures, etc.). The state of the industry in different countries is determined by the reference to national conditions and the global context. The only we can say for sure is that the industry requires major developments and implementation of modern production methodologies and techniques.

What to Expect in the Future?

It is expected that trade in dairy products will grow faster than its production speed. It is also believed that most of the manufactured products will be realized on national markets and the EU area. If we do not take into account trade within the European Union, only 14% of the world’s milk is produced on the world market. The importance of developing countries as dairy market participators will continue to grow. Further, the expansion of Indian and Chinese markets is expected to happen. What is more, the increase in consumer demand will also stimulate the increase in dairy products output. An average annual growth rate of milk production in developing countries will reach 2.5% by 2030. Thus, in 15 years, the consumption of milk and dairy products per capita will grow from 212 to 221 kg.

Development Tendencies in the Industry

The most notable structural tendency in the dairy products production is the growth of the value of intensive, vertically integrated formations in the suburbs. Consequently, big companies are increasingly moving from horizontal to vertical integration. This involves diversifying their activities in the conjunction with the basic production. On the top of that, the world leaders in the industry are all becoming more peculiar to the desire to merge into a single large corporation. The escalation of world prices for dairy products by analysts of international organizations also tends to be seen as symptoms of wider structural changes in the dairy market. These trends are supported by the improvement of dairy sales channels and the development of relevant state programs in different countries.

In order to support the high demand for dairy products, the industry needs to be developed, with all modern methodologies and techniques to be implemented to the production processes. Otherwise, we risk not to meet the customer demand.