CURD, YOGURT AND SOUR MILK PRODUCTS
In India, curd and yogurt is considered as same and part of the daily diet for many. Both these products witnessed a surge in demand each year. While curd is widely consumed across the country, consumption of yogurt is gaining popularity because of its health benefits – specifically, pro-biotic range of products, ability to improve metabolism and enhancement of the immune system. Yogurt is also consumed as dessert. This is the fastest growing product segment and value wise it is the largest segment after liquid milk.
Nandini (Karnataka Cooperative Milk Producers Federation Ltd) and Amul are the market leaders with nearly equivalent share in terms of value. Both the companies are estimated to have around 16-18% of the market share. However, other old and new entrants are offering healthy competition with product variety, innovation and pricing.
Curd, Yogurt and sour milk products are traditionally part of the Indian food plate. The share of this products segment is growing even faster with more disposable income, health benefits and more women joining the work force. Just curd market is expected to be around 20,000 crore for the organised sector (60% of the total market) by 2020! Good time for value added dairy product manufacturers has arrived.
Cheese is finding more space in food plates and witnessed gradual growth in consumption. Increased availability, adoption of Western products and eating out has helped the growth in volume and variety in cheese products. Cooking shows and contents in social media and television has educated consumers to new types of cheese like mozzarella, emmental and parmesan, while buying them become easier through retail channels.
Amul is the market leader in cheese with a share of 43% in terms of value during 2017. However, report indicates that Amul’s share has come down by two percent from previous year. This is primarily attributed by the entry of new brands like Kraft, Arla, Tech Organea and higher sales by local brands like Britannia, Govardhan, Flanders Dairy etc. So, the competition in cheese market is getting tougher. While Amul remains at the pinnacle, other players have to work hard on widening distribution channels, strong brand building, product innovation and more importantly they have to price the product competitively.
Cheese market in India is around Rs 2900 crore and expected to grow at a CAGR of 13% in the coming five years. Growing disposable income has brought changes in the lifestyles and food habits of consumers while rapidly increasing food delivery and food service channels, wider product availability and growing consumerism will support rapid growth of cheese consumption in India. Leading cheese manufacturers are investing on adding production capacity which is a clear indication of growing demand. Increased competition has resulted in wider promotional activities by brands which is pushing up consumption and increase in distribution channels have fairly improved penetration which will contribute to the growth of the category.
Reports suggest that sales of carbonated drinks and artificial fruit-based drinks are dwindling as consumers are looking towards healthier drinks that include dairy based products. So, this category would show faster growth in coming years. Several large brands are experimenting to introduce flavored milk drinks to cater to the emerging class of health-conscious consumers.
Amul again leads the milk drink market having the advantage procurement, production, R&D and distribution. Estimated market share of Amul is pegged at 17-20% in terms of value.
The competitive advantage of Amul is going to be intact while other players are making good penetration. Understanding the taste of consumers, distribution and advertisement campaign would play a major role for success in this segment.
Milk drink products are expected to experience remarkable growth in India. The driving factors would be health benefits compared to artificial drinks available in the market and necessity of consumption in day to day life.
OTHER VALUE ADDED DAIRY PRODUCTS
Every player in the sector is vying for a larger share of the pie of value added milk products. Several new players including foreign ones have entered the Indian dairy space and large investments have been made which is still continuing. Consumption of other dairy products (condensed milk, cream etc.) has been growing as they are part of the recipe of widely consumed traditional dishes like kheer, gulab jamun, halwa and desert mixes.
Nestlé India is the market leader in this other milk products category with nearly 40% market share in terms of value. The company’s product in condensed milk segment has almost no competition while the coffee whiteners have sizable competition from several brands.
Like all the products other value added dairy products have witnessed near double digit growth in the last few years. The size of the market is estimated at around INR 4200 crores in 2017 which is expected to grow at 10-12% each year for next five years. Rising purchasing power of consumers, expanding food sector, strong demand for ready-to-eat dairy products and improved distribution network will support the growth in this category.