Dairy

Market Overview

Growing Asia* is the N1 region for growth (registered fastest growth over 2012 – 2017), and will reach USD 117 B in 2021 Asia-Pacific region expected to make up 63% of absolute dairy growth in volume terms (over 2016 – 2021)   The three most important segments as of 2017 are:
  • Milk (54% of the dairy market volume)
  • Yoghurt and fermented milk (16%)
  • Cheese (7%)
*Growing Asia means ASEAN, India and China

Opportunities & Trends

  • China: Dairy sales expected to grow at 5.3% CAGR 2016 – 2021
    • Globalization prompting more M&As: demand for increasing amount of imported/diversified products
    • Development Plan for China Milk Industry promotes market consolidation (target >80% domestic sales to come from Top-10 China players by 2020E)
    • Negligible MNCs presence (7-8% of upstream market share)
 
  • India: World N1 milk producing country (50% more than the US, N2 milk producing country)
    • Indian dairy market at the cusp of a Dairy Revolution: aggressive transition from unorganized/local market (80% of Indian dairy market) to organized/branded market (20% of Indian dairy market)
 
  • ASEAN: The largest market is Indonesia (7th global dairy market) while the fastest growing market is Vietnam (+17% CAGR 2016 – 2020)
    • ASEAN nations produce only 3% of all dairy consumed within their borders.
Source: GCF Research & Analysis, Euromonitor  

Food Ingredients

Market Overview

  • Escalating global population, changing demographics, increasing healthcare expenditures, and growing demand for packaged food and beverages drive the global food ingredient market growth.
  • Asia-Pacific market is estimated to grow with the highest CAGR in 2018 – 2023 (23% CAGR), driven by GDP growth, demand for better-flavored products and rising middle class.
  • Asia-Pacific: largest regional market globally (34% of overall revenue in 2016), and expected to generate revenue of USD +39 B by 2025.

Opportunities & Trends

China has the highest number of processing and specialty ingredients manufacturing in the region. Industry players are shifting production bases to Growing Asia (India, Thailand and Vietnam).
Sources: GCF Research, MAPE, Frost & Sullivan, Ingredients Network, the Times of India Food Ingredients market in India is expected to reach USD 1,850M in 2020 and is forecasted to grow at 13% annually.
  • Processing levels of perishables to increase from 6% to 20% by 2019, with 42% of the food processing output from the unorganized sector
  • Key drivers: urbanization, changing lifestyles, rising consumption spending
  • Set up of a “Food Processing Fund” by the Indian governmen
*Growing Asia means ASEAN, India and China  

Water Bottling

Market Overview

From 2014 to 2017, the global bottled water market grew to over USD 240 B (9% CAGR) The global bottled water market is expected to have a market size of USD 340 B in 2021 Global per capita average bottled water expenditure was USD 32,3 per head in 2017, and a total consumption of 437 liters
 
The Asia-Pacific region concentrated 31% of the global bottled water market in 2017.   The global bottle water industry has been experiencing rising demand from developing nations, especially in Asia. The global market is projected to grow at +10% CAGR 2018 – 2023
  • Asia-Pacific demand is expected to grow at faster rate (increasing young working population, rising number of water borne diseases, growing concerns over safety & purity of tap water)
  • China (17% of 2017 total) generates most bottled water revenue in 2017, with a market volume of USD 42 B
  • Indonesia is the largest market in ASEAN and the 2nd after China in Asia
  • Indian bottled water is expected to grow annually by 14% (CAGR 2018 – 2021), and has the world’s largest population without access to clean water

Opportunities & Trends

  • Local M&A landscape:
    • Local consumers trust MNC’s products: safety & quality
    • Tremendous growth in demand for health products provides space for new entrants
    • Local governments welcome MNCs who take care of environmental resources
  • Offering JV/ acquisition opportunities
    • Local players’ small sizes offer good opportunities to enter potential markets with a limited downside
    • Attractive growth markets due to increasing consumer wealth & spending
*Growing Asia means ASEAN, India and China