Soured: Fluctuations in export markets have negatively affected industry revenue

The Cheese, Butter and Milk Powder Manufacturing industry has had volatile revenue growth over the past five years. The industry's heavy reliance on export markets for revenue has made it vulnerable to price fluctuations in global markets. These price fluctuations have contributed to strong movements in export rates, and therefore revenue swings over the period. Overall, industry revenue is expected to fall at an annualised 1.3% over the five years through 2019-20, totalling $19.4 billion.Immense demand growth in 2013-14 increased global dairy prices, driving dairy product manufacturers in other major exporting countries to increase their production. The subsequent spike in output contributed to a global oversupply of dairy products...read more.

Industry Statistics & Market Size
Revenue
$19bn
Annual Growth 15-20
-1.3%
Forecast Growth 20-25
Profit
Employment
15,458
Businesses
105

Industry Threats & Opportunities

  • The industry's reliance on exports has made it vulnerable to price fluctuations in global markets
  • Export markets have become increasingly important due to saturation in the local market
  • Recovering prices in export markets are expected to lift profit margins
  • Industry Report - Industry Key Buyers Chapter

    The industry exhibits high market share concentration, with the four largest operators expected to make up over 85% of industry revenue in 2019-20. However, most of the industry’s concentration is attributable to Fonterra, which accounts for an estimated 72.3% of revenue in the current year. Smaller operators, such as Synlait and Westland, have grown to account for a large share of the industry over the past five years. Although dairy farmers can choose which company they sell their raw milk to, most choose to remain with Fonterra as the company can leverage its size to achieve higher prices in export markets and deliver greater margins...purchase to read more.

    Additional Insights for the Cheese, Butter and Milk Powder Manufacturing Industry

    IBISWorld has determined the most important Key Success Factors for the Cheese, Butter and Milk Powder Manufacturing are:

  • Having links with suppliers
  • Development of new products
  • Marketing of differentiated products
  • IBISWorld analysts also discuss how external factors such as Demand from general line grocery wholesaling and Milk production in the Cheese, Butter and Milk Powder Manufacturing industry impact industry performance..

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    What's in this report

    What is the Cheese, Butter and Milk Powder Manufacturing in New Zealand Industry?

    Industry operators primarily manufacture dairy products, such as cheese, yoghurt, butter, milk powder, canned cream and condensed milk. The industry excludes the production of fresh milk, fresh cream and ice cream.

    Industry Products
  • Milk and cream concentrates
  • Butter and dairy spreads
  • Cheese
  • Proteins
  • Other dairy products
  • Industry Activities
  • Butter
  • Buttermilk
  • Cheese
  • Condensed milk
  • Canned cream
  • Flavoured milk
  • Milk-based infant formula
  • Milk powder
  • Sour cream
  • Yoghurt
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Demand from general line grocery wholesaling
  • Milk production
  • Cheese and butter consumption
  • Trade-weighted index

  • Current Performance
  • Global trends
  • International policy issues
  • Domestic consumption
  • Profit and structure
  • Chart: Revenue Growth

  • Industry Outlook
  • Export reliance
  • Domestic market
  • Profit and structure
  • Table: Cheese, Butter and Milk Powder Manufacturing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Cheese, Butter and Milk Powder Manufacturing Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • General Line Grocery Wholesaling in New Zealand
  • Supermarkets, Grocery Stores and Convenience Stores in New Zealand
  • Cafes and Restaurants in New Zealand
  • Catering Services in New Zealand

  • Key Selling Industries
  • Dairy Cattle Farming in New Zealand

  • Products & Services
  • Milk and cream concentrates
  • Butter and dairy spreads
  • Cheese
  • Proteins
  • Other dairy products
  • Chart: Cheese, Butter and Milk Powder Manufacturing Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Other export markets
  • Exports to China
  • Wholesalers
  • Supermarkets and grocery stores
  • Other domestic markets
  • Chart: Major Market Segmentation for the Cheese, Butter and Milk Powder Manufacturing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Cheese, Butter and Milk Powder Manufacturing

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Cheese, Butter and Milk Powder Manufacturing Industry

  • Industry Globalization
    Fonterra Co-operative Group Limited, Talley's Group Limited,
  • Table: Fonterra Co-operative Group Limited - financial performance
  • Table: Talley's Group Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Cheese, Butter and Milk Powder Manufacturing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

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

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Cheese, Butter and Milk Powder Manufacturing Industry
    Includes:
  • Industry Revenue (2011-2025)
  • Industry Gross Product (2011-2025)
  • Establishments (2011-2025)
  • Businesses (2011-2025)
  • Employment (2011-2025)
  • Exports (2011-2025)
  • Imports (2011-2025)
  • Wages (2011-2025)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Anhydrous Milk Fat
  • Also known as butter oil, anhydrous milk fat is an evaporated butter made almost solely from milk fat.
  • Farmgate Prices
  • The price paid by processors to dairy cattle farmers, typically expressed as dollars per kilogram of milk solids.
  • Lactoferrin
  • A protein extracted from milk that can be used as an input in nutritional products, such as supplements and infant formulas.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Cheese, Butter and Milk Powder Manufacturing in New Zealand market research report offers insightful industry analysis and research into the market at the national level. IBISWorld’s in-depth industry market research is presented in a logical and consistent format. The industry report contains key industry statistics, market size, industry trends, and growth and profit forecasts for a 5-year outlook period.

    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 Cheese, Butter and Milk Powder Manufacturing in New Zealand:
    • 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 Cheese, Butter and Milk Powder Manufacturing in New Zealand 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 Cheese, Butter and Milk Powder Manufacturing in New Zealand, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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