Chinese imports up
Demand for milk and dairy products continues to grow strongly in China and with it imports, according to Agrarmarkt Austria (AMA), the public corporation that has overall control of Austrian agriculture. In the last three years, export of Austrian milk and dairy products to China has been expanded considerably. From January to August 2020 exports in the milk sector have amounted to 30,648 tons with a value of €35.6 million.
In the same period of the previous year, 16,365 fewer tons were exported to China and from January to August 2018 there was a total export of 9,793 tons of milk and dairy products.
The biggest Austrian export boom to China has been in milk and unsweetened cream as well as cheese and curd cheese.
The data shows that the consumption of milk and dairy products in China continues to rise rapidly and that this cannot be covered by domestic production. Demand is increasing not only for powdered and liquid milk, but also for butter and cheese.
However, the Chinese market is highly competitive. New Zealand and Australia are trying to expand their market shares and the US is also trying to strengthen its market position in China. For European exporters, it is therefore always a great challenge to maintain or even expand their market shares.
This year’s EU exports from January to September show that butter sales to China increased by around 60% compared to the same period of the previous year and are now at 11,828 tons. An increase of approximately 41% was achieved for cheese. In contrast, EU exports of skimmed milk powder decreased by 7% over the same period. Whole milk powder remained roughly constant compared to the same period in 2019.
According to forecasts by the Chinese Ministry of Agriculture and Rural Affairs, China’s imports of drinking milk, mainly packaged UHT/long-life milk, are expected to increase to 980,000 tons in 2021, an increase of 5% compared to 2020. The EU remains the largest exporter of liquid milk to China.
It is also assumed that butter imports (+17%) will increase sharply in 2021. The largest trading partner here is New Zealand with a market share of more than 80%. The EU remains the second largest butter supplier for China.
Strong milk powder import growth is also expected for 2021. China’s import of whole milk powder is estimated at 715,000 tons and the import volume of skimmed milk powder is estimated at 340,000 tons. New Zealand and the US are the main exporters. The EU only plays a subordinate role.