Milk & Dairy Products

2009 UK - Market Report Plus

Publication Date	July 2009
Publisher	Key Note
Product Type	Report
Pages	107
ISBN Number	not applicable
Product Code	KEY00059

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Summary

This Key Note Market Report examines the UK market for milk and dairy products, which is broken down into the following sectors: liquid milk; cheese; yogurts, yogurt drinks and chilled desserts; yellow fats; and cream. The value of the milk and dairy products market rose strongly from 2004 and was worth £8.43bn by 2008 (at retail selling prices [rsp]).

The liquid milk sector is dominated by retailer own-label products. However, suppliers have had some success with the introduction of their own brands, such as Cravendale and Lactofree from Arla. In addition, interest in regional suppliers and food miles has developed the market for locally sourced milk.

Cheese sales rose strongly as consumers continued to develop a taste for stronger and more diverse flavours. The development of more convenient formats and reduced-fat recipes has also been well received.

The market for yogurts, yogurt drinks and chilled desserts has also gained from consumer demand for healthier and more convenient products. Growing demand for functional brands has also driven sales.

The yellow fats sector has seen a strong surge in butter sales, as consumers look for more natural products and take a more balanced approach towards healthy eating. The development of spreadable formats has also added value to sales.

While added-value activity has been a feature of the milk and dairy products market, a large proportion of the sales increases in 2007 and 2008 were driven by rising costs, which drove prices upwards. All sectors experienced strong inflation in 2008, as higher input and distribution costs fed through to retail prices.

The downturn in the UK economy has also had an impact on the market. There is a greater focus on price, leading some consumers to trade down to cheaper products and reduce volume purchases of more indulgent items. However, as many products in this market are regarded as essentials rather than luxuries, consumers will switch spending rather than leave the market, and economic recovery will have a positive impact on the market in the medium to long term.

Content

Executive Summary
1. Market Definition
- REPORT COVERAGE
- MARKET SECTORS
- MARKET TRENDS
- Milk and Dairy Consumption
- Table 1.1 Average Weekly Per Capita Consumption of Milk and Dairy Products (millilitres [ml] and grams [g]), 1997, 2006 and 2007
- Liquid Milk
- Yogurt
- Cheese
- Butter
- Dairy Desserts
- Cream
- Price Differentials
- Recession and Inflation
- Functional Slowdown
- ECONOMIC TRENDS
- Gross Domestic Product
- Table 1.2: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2004-2008
- Household Disposable Income
- Table 1.3: UK Household Disposable Income Per Capita (£), 2004-2008
- Inflation
- Table 1.4: UK Rate of Inflation (%), 2004-2008
- MARKET POSITION
- The UK
- Table 1.5: UK Expenditure on Food and Non-Alcoholic Beverages, and on Milk, Cheese and Eggs at Current Prices (index 2004=100 and %), 2004-2008
- Figure 1.1: UK Expenditure on Food and Non-Alcoholic Beverages, and on Milk, Cheese and Eggs at Current Prices (index 2004=100), 2004-2008
- Overseas
2. Market Size
- THE TOTAL MARKET
- Table 2.1: The Total UK Market for Milk and Dairy Products by Sector by Value at Current Prices (£m at rsp), 2004-2008
- Figure 2.1: The Total UK Market for Milk and Dairy Products by Sector by Value at Current Prices (£m at rsp), 2004-2008
- BY MARKET SECTOR
- Figure 2.2: The Total UK Market for Milk and Dairy Products by Sector Share by Value at Current Prices (%), 2008
- Liquid Milk
- Table 2.2: The UK Liquid Milk Sector by Value at Current Prices (£m at rsp), 2004-2008
- Branded Milk
- Regional Milk
- Value Brands
- Lower Fat
- Long-Life Milk
- Flavoured Milks
- Cheese
- Table 2.3: The UK Cheese Sector by Value at Current Prices (£m at rsp), 2004-2008 Increased Varieties
- Healthier Cheeses
- Convenience
- Yogurts, Yogurt Drinks and Chilled Desserts
- Table 2.4: The UK Yogurts, Yogurt Drinks and Chilled Desserts Sector by Value at Current Prices (£m at rsp), 2004-2008
- Yogurts
- Yogurt Drinks
- Chilled Desserts
- Yellow Fats
- Table 2.5: The UK Yellow Fats Sector by Value at Current Prices (£m at rsp), 2004-2008
- Butter
- Spreads
- Cream
- Table 2.6: The UK Cream Sector by Value at Current Prices (£m at rsp), 2004-2008
- OVERSEAS TRADE
- Table 2.7: UK Overseas Trade in Selected Dairy Products by Type by Volume (million litres and 000 tonnes), 2007 and 2008
3. Industry Background
- RECENT HISTORY
- NUMBER OF COMPANIES
- Table 3.1: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Manufacture of Dairy Products by Turnover Sizeband (number and %), 2008
- EMPLOYMENT
- Table 3.2: Number of UK VAT- and/or PAYE-Based Enterprises Engaged in the Manufacture of Dairy Products by Employment Sizeband (number and %), 2008
- REGIONAL VARIATIONS IN THE MARKETPLACE
- DISTRIBUTION
- HOW ROBUST IS THE MARKET?
- LEGISLATION
- KEY TRADE ASSOCIATIONS
- DairyCo
- Dairy UK
4. Competitor Analysis
- THE MARKETPLACE
- MARKET LEADERS
- Arla Foods Ltd
- Dairy Crest Group PLC
- Dairy Farmers of Britain Processing Ltd
- Danone Ltd
- The First Milk Cheese Company Ltd
- The Kerrygold Company
- Kraft Foods UK Ltd
- Lactalis McLelland Ltd
- Lactalis Nestl?(C) Chilled Dairy Company Ltd
- Milk Link Processing Ltd
- M? 1/4 ller Dairy (UK) Ltd
- Robert Wiseman Dairies PLC
- Unilever PLC
- Uniq PLC
- Yoplait UK Ltd
- Other Companies
- Bel UK Ltd
- Benecol
- Campina
- Dale Farm
- Delamere Dairy
- Grahams Dairy
- G? 1/4
- Kavli Ltd
- Kerry Foods
- North Downs Dairy Co Ltd
- Onken Dairy UK
- Rachel's Organic
- Shepherds Purse Cheeses Ltd
- Wyke Farms Ltd
- Yakult UK Ltd
- Yeo Valley Organic Company Ltd
- OUTSIDE SUPPLIERS
- Table 4.1: Utilisation of Raw Milk for Manufacture by Dairies in the UK (million litres) 2004, 2006 and 2008
- MARKETING ACTIVITY
- Main Media Advertising Expenditure
- Table 4.2: Main Media Advertising Expenditure on Milk and Dairy Products (£000 and %), Years Ending March 2008 and 2009
- Recent Promotional Activity
- Arla Foods
- Bel UK
- Dairy Crest
- Danone
- First Milk
- Kerry Foods
- The Kerrygold Company
- Kraft Foods
- Lactalis McLelland
- Milk Link
- M? 1/4 ller
- North Downs Dairies
- Onken
- Robert Wiseman
- Unilever
- Wyke Farms
- Exhibitions
5. Strengths, Weaknesses, Opportunities and Threats
- STRENGTHS
- WEAKNESSES
- OPPORTUNITIES
- THREATS
6. Buying Behaviour
- CONSUMER PENETRATION
- Table 6.1: Consumption of Dairy Products in the Last 12 Months (% of adults), 2002, 2004 and 2006-2008
- By Sex
- Table 6.2: Consumption of Dairy Products in the Last 12 Months by Sex (% of adults), 2008
- By Age
- Table 6.3: Consumption of Dairy Products in the Last 12 Months by Age (% of adults), 2008
- By Social Grade
- Table 6.4: Consumption of Dairy Products in the Last 12 Months by Social Grade (% of adults), 2008
- By Region
- Table 6.5: Consumption of Dairy Products in the Last 12 Months by Region (% of adults), 2008
7. Current Issues
- NEW PRODUCTS AND BRANDS
- AOC Camembert
- Go Dutch
- Innocent
- Plum
- Yalp!
- COMPANY DEVELOPMENTS
- Hartington Creamery
- H&B Foods
- Ilchester Cheese
- MILK PACKAGING
- RAW MILK PRICES
- SCHOOL MILK SCHEME EXTENSION
8. The Global Market
- GLOBAL TRENDS
- THE US MARKET
- Table 8.1: US Milk Supply Utilisation by Product by Value (£m), 2007
- GLOBAL MARKETPLACE DEVELOPMENTS
- Agropur and Schroeder (US)
- Arla Foods (Denmark and Netherlands)
- Bongrain (France)
- Campina and Friesland Foods
- Danone
- Emmi (US and Switzerland)
- Fonterra (Australia and Egypt)
- Kerry Foods
- Milk Link (The People's Republic of China)
- Saputo (Canada)
- Vivartia (Greece and Japan)
9. Forecasts
- INTRODUCTION
- The Economy
- Gross Domestic Product
- Table 9.1: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2009-2013
- Inflation
- Table 9.2: Forecast UK Rate of Inflation (%), 2009-2013
- Population
- Table 9.3: Projected UK Population (000), 2006, 2008, 2010, 2012 and 2014
- FORECASTS 2009 TO 2013
- Table 9.4: Forecast Total UK Market for Milk and Dairy Products by Value at Current Prices (£m at rsp), 2009-2013
- MARKET GROWTH
- Figure 9.1: Growth in the Total UK Market for Milk and Dairy Products by Value at Current Prices (£m at rsp), 2004-2013
- FUTURE TRENDS
- Supply
- Retail Market
10. Company Profiles
- Arla Foods Ltd
- Dairy Crest Group PLC
- Danone Ltd
- Lactalis McLelland Ltd
- Milk Link Processing Ltd
- M? 1/4 ller Dairy (UK) Ltd
- Unilever PLC
11. Further Sources
- Associations
- Publications
- General Sources
- Government Publications
- Other Sources
- Key Note Sources
- Understanding TGI Data
- Number, Profile, Penetration
- Social Grade
- Standard Region
- Key Note Research
- The Key Note Range of Reports