COVID-19 to add extra US$1.6bn to milk sales in China in 2020

Milk, the largest dairy category in China, is predicted to stand at US$26.9bn in 2020, US$1.6bn greater than the previously projected pre-COVID value. This translates to an increase on expected volumes from 9.6 billion kg to 10 billion kg in 2020 alone, primarily due to health concerns relating to COVID-19, according to GlobalData, a leading data and analytics company.

“China invested heavily in modernizing its dairy industry for the past several years and officially promotes milk consumption on the basis of its health benefits. Refrigeration has become increasingly ubiquitous in China, meaning that modern consumers have the space to store milk and other dairy products for longer,” Ryan Whittaker, consumer analyst at GlobalData said.  “Milk is often positioned as a means to get more protein into their diet, and to help build and maintain the body’s immune system. Of course, COVID-19 pandemic has forced Chinese consumers to focus on their health, prompting a surge in demand.”

GlobalData forecasted annual milk sales in China, which were valued at US$24.2bn in 2019, to increase gradually to US$29bn in 2023. Following COVID-19-related disruptions, the projected figure is now closer to US$31bn, with the largest jump in sales occurring in 2020.

GlobalData’s most recent consumer survey found that 47 per cent of Chinese consumers consider themselves ‘extremely concerned’ about their health, whilst a further 52% said that they were ‘quite’ or ‘slightly concerned’ – in fact, only 2% of respondents said that they were ‘not concerned’ about their health at all.

When asked about white milk buying habits, a shocking 51% of respondents said that they were buying more than before, in addition to the 34% who said they were buying the same as before.

“The impact of COVID-19 on cooking at home should not be overlooked. During China’s lockdown, consumers were forced to remain at home and cook for themselves far more than before, and in doing so, ate out and on-the-go much less than before,” Whittaker said. “Milk offers a simple way to top-up nutrition at home with minimal effort while helping China’s dairy industry. Clearly, the milk category will do well during the pandemic, and attitudes towards health, supported by the government’s pro-dairy campaigns, are likely behind it.”