Spilt milk: Current year revenue falls due to low domestic milk prices

The Milk and Cream Processing market research report provides key industry analysis and industry statistics, measures market size, analyzes current and future industry trends and shows market share for the industry’s largest companies. IBISWorld publishes the largest collection of industry reports so you can see an industry’s supply chain, economic drivers and key buyers and markets.


Industry Threats & Opportunities

  • The industry has grown strongly over the past five years, despite challenging domestic conditions
  • Falling domestic milk prices and rising operating costs have reduced margins for many operators
  • Strong demand in export markets and improving global trading conditions should support margins

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    Industry Analysis & Industry Trends

    The Milk and Cream Processing industry has grown strongly over the past five years, despite challenging conditions in the domestic market. Rising demand for Australian milk in export markets has boosted industry earnings over the period. Industry revenue is expected to grow at an annualised 6.8% over the five years through 2016-17, to reach $2.2 billion. However, reduced domestic milk prices are expected to depress industry revenue by 3.0% in 2016-17. Industry profitability has fallen over the past five years as processors have been forced to absorb higher operating costs.

    The ongoing milk war between the major supermarket chains, which has led to private-label milk products being priced at $1.00 per litre, has changed the way milk processors operate...

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    Industry Report - Starting a New Business Chapter

    The barriers to entry in the Milk and Cream Processing industry are high, with the biggest threat facing potential entrants being the well-entrenched position of the industry's major players Lion, Parmalat, Fonterra and Murray Goulburn. These global players enjoy high brand and customer loyalty and have considerable resources to invest in advertising and promotions to protect and grow their market share. Further, the major players have long-term contracts in place with key suppliers, such as grocery stores and supermarkets, which may be difficult for new entrants to secure.

    All of the industry's major players have strong product portfolios with many of the country's best-known dairy brands being owned between them. Eno..

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    Additional Insights for the Milk and Cream Processing Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Milk and Cream Processing Industry are

  • Market research and understanding
  • Use of specialist equipment or facilities
  • Use of production techniques that add value to base product(s)
  • IBISWorld analysts also discuss how external factors such as Domestic price of milk and Milk production in the Milk and Cream Processing industry impact industry performance..

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    Industry Products

    What is the Milk and Cream Processing Industry?

    The Milk and Cream Processing industry primarily pasteurises and separates raw milk to make milk and cream products with varying levels of fat content. The industry excludes the manufacture of cultured buttermilk, flavoured milk (whole and skim), sour cream and yoghurt.

    Industry Products
    Whole milk
    Low and reduced-fat milk
    UHT milk
    Industry Activities
    Pasteurised cream (except canned)
    Low-fat milk
    Pasteurised milk
    Skim milk
    Whole milk
    Ultra pasteurisation milk

    Table of Contents

    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Domestic price of milk
  • Milk production
  • Demand from supermarkets and grocery stores
  • Trade-weighted index
  • Milk consumption

  • Current Performance
  • Milk prices
  • International trade
  • Supermarket milk wars
  • Production and demand
  • Chart: Revenue Growth

  • Industry Outlook
  • Demand opportunities
  • Price and production
  • Future challenges
  • Table: Milk and Cream Processing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Milk and Cream Processing Industry Lifecycle vs The Economy

  • Products & Markets
    Supply Chains
    Key Buying Industries
  • Dairy Produce Wholesaling
  • Catering Services
  • Supermarkets and Grocery Stores
  • Convenience Stores
  • Cafes and Coffee Shops

  • Key Selling Industries
  • Dairy Cattle Farming

  • Products & Services
  • Whole milk
  • Low and reduced-fat milk
  • UHT milk
  • Cream
  • Chart: Milk and Cream Processing Industry Products and Services Segmentation

  • Demand Determinants
  • Health concerns
  • Innovation

  • Major Markets
  • Supermarkets
  • Export markets
  • Grocery wholesalers
  • Convenience stores
  • Food-service establishments
  • Other
  • Chart: Major Market Segmentation for the Milk and Cream Processing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Milk and Cream Processing

  • Basis of Competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Milk and Cream Processing Industry

  • Industry Globalization
    Major Companies
    Murray Goulburn Co-operative Co LimitedLion Pty LtdParmalat Australia Pty LtdFonterra Co-operative Group Limited
  • Table: Murray Goulburn Co-operative Co Limited - financial performance
  • Table: Lion Pty Ltd - financial performance
  • Table: Parmalat Australia Pty Ltd - financial performance
  • Table: Fonterra Co-operative Group Limited - financial performance

  • Operating Conditions
    Capital Intensity
  • Chart: Level of Capital Intensity for the Milk and Cream Processing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Key Statistics
    Table: Industry Data for the Milk and Cream Processing Industry
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Exports (2008-2022)
  • Imports (2008-2022)
  • Wages (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Jargon & Glossary
    Plant Sterol
  • A naturally occurring steroid compound that helps lower cholesterol.
  • Private-Label Products
  • Products that are manufactured by a company for sale under another company's brand, typically a supermarket retailer. Private-label products tend to be cheaper than manufacturers' branded products.
  • Uht Milk
  • Milk that is heated at ultra-high temperatures during processing.
  • Why buy this report?

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Milk and Cream Processing:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Milk and Cream Processing market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Milk and Cream Processing, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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