The global milk industry is continuously achieving new heights in terms of production and availability of milk across all major regions. Various forms of developments and innovations in this industry have introduced the concept of ultra-high temperature (UHT) milk. UHT milk has gained significant recognition in the recent years due to the distinctive features it has to offer to its consumers. The UHT milk industry is expected to grow at a noteworthy CAGR of 4.57% during the period from 2019 to 2024, as per the market analysis by BIS Research.
Factors Propelling the Growth of the UHT Milk Industry
The burgeoning global population, urbanization, and disposable income have proliferated the demand for premium milk. The various attributes of UHT milk, such as a long-shelf-life and convenience in usage, have influenced the urbane youth toward a wide consumption of UHT milk. The variants in UHT milk, such as skimmed and semi-skimmed, offer special benefits for a vital section of the health-conscious population.
UHT milk producers are currently focusing on attracting a large customer base for at least a single-time purchase of the product, which can act as a proper introduction for the consumers with regard to the taste and quality of UHT milk. To achieve this, the producers are fixing the pricing of the product as slightly higher than that of fresh dairy milk, so that it is not too expensive for first-time buyers. By collaborating with regional milk producers, major UHT milk producers are actively introducing heating technology involved for manufacturing UHT milk across both tier-1 and tier-2 cities globally.
Let us see the UHT milk industry scenario based on various factors:
By Milk Type: Semi-Skimmed Milk Growing at the Highest Rate in the UHT Milk Market
During the forecast period of 2019–2024, the semi-skimmed milk segment for the UHT milk industry is expected to display the highest growth rate of 5.42%. This milk type finds its proliferated usage in fulfilling the majority of the nutritional requirements of the population, with a balance of fat content, proteins, and vitamins obtained in semi-skimmed milk. It also helps curbing the risk of diabetes and cancer.
The demand for skimmed milk is also expected to witness a healthy growth in the upcoming years, owing to the increased adoption by the growing number of working women because of enhanced amounts of vitamin D and calcium in it.
By Application Area: Direct Sales to Contribute the Largest Sales Volume for UHT Milk
UHT milk is largely sold through two major distribution channels which are direct/institutional channel and retail channel. As of 2018, the retail channel for selling UHT milk contributed the largest volume of sales for this industry. Its increasing use in the food service industry, defense, and various workspaces, the sale of UHT milk through direct/institutional channel is expected to increase at the fastest rate during the forecast period.
By Region: Europe to Maintain its Market Dominance in the Forecast Period
Different regions have gradually increased the adoption of UHT milk products with varying degrees, mainly due to the government influence across countries. Europe is expected to maintain the market dominance in the UHT milk industry in the forecast period, owing to the increasing adoption of UHT milk by the majority of the population in the region.
The Chinese UHT milk market is expected to drive the sales volume due to the competitively priced product offerings. Stakeholders across Middle East and Africa are also showing an extensive degree of enthusiasm and exploring various arenas of investment for technologically advancing their industries.
Strategies Incorporated by Players to Sustain the Competition in the UHT Milk Market
Leading players in the UHT milk industry include Nestle S.A., Lactalis Group, Arla Foods, Sodiaal Group, China Mengniu Dairy Company Limited, Yili Group, and Fonterra Co-operative Group, among others. The highlight of the competitive landscape for the UHT milk industry includes companies adopting strategies such as business expansion backed by incentives of expanding to new regions and building a strong customer base.
Key players are also engaging in mergers and acquiring comparatively smaller companies, which have a strong regional presence. For instance, in January 2019, Lactalis Group acquired India-based dairy business of Prabhat Dairy to improve its regional presence in the country and cater to the increasing local demand for UHT milk.