New research findings by Tetra Pak indicate that the demand for milk around the world is set to overtake the available supply for the first time over the next decade.
According to this year’s Dairy Index Report, global consumption of dairy products, such as milk, cheese and butter, is expected to rise by 36 percent in the next 10 years to reach the equivalent of 713 million tonnes of liquid milk.
As the population in Kenya and East Africa is expected to grow from 24% to close to 50%, the demand will rise 20%.
The company attributes the increased demand to mainly by population growth, rising prosperity and urbanisation in Africa, Asia and Latin America. However, milk supply and demand is imbalanced across the world – rising demand in emerging dairy markets is unlikely to be fulfilled by locally produced raw milk, while developed dairy markets producing a milk surplus face the challenges of competing for the export and responding to falling domestic consumption.
Tetra Pak Eastern Africa Managing Director Hakan Soderholm says the local industry will be able to meet the demand in the long-term as availability of raw milk in Kenya and in East Africa will be further improved with continued investment in dairy hubs, better breeds and better farm management. According to the Kenya Dairy Board, Kenya produces over 5 billion litres of milk annually but only 10 percent is processed and packaged.
In developing markets, Soderholm noted that one of Tetra Pak’s priorities was to meet the needs of people with less purchasing power and consumption capacity with new and innovative ways of working, so to support customers serving consumers in this segment with products that are affordable, available and attractive.
He noted that dairy companies need to understand and adapt to changing consumer demographics, behaviour and lifestyle as product diversification, innovation and brand differentiation will be crucial for sustainable business success.