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日益紧密的全球及中国乳业市场
发展与展望、机遇与挑战
June 2014
Sandy Chen 陈炜 Senior Analyst
Food & Agribusiness Research and Advisory 食品与农业研究及咨询部 Rabobank International 荷兰合作银行
全球市场发展和展望 a
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Why is China important?
Source: Various
One of the largest dairy market Milk deficits rising in recent years Demand growing!
4
Strong growth in dairy imports in recent years
5
In 2013, increased Chinese buying from a shrinking pool left less product for other importers
Source: Rabobank
Prices rose to ration supply.
6
Global commodity prices have surged in 2013/14
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We expect a 4% growth in milk supply in export regions in H1 14 (on weak comparables), then a slowdown
8
The increase in milk surplus in export regions will exceed China’s additional requirements in H1 2014
For the first time in 12
months, non Chinese
buyers get the chance to
increase imports
Prices will ease, as the
need to ration supply
reduces
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Global commodity prices: easing off, but not a crash
10
Growth in EM, and constraints on their ability to expand milk supply quickly, will fuel an era on strong trade expansion
Combining Rabobank forecasts, deficit regions around the world would import an additional 25 billion litres of imports by 2020 (CAGR 5.1% p.a)
Dairy export share 2012
Where will the export milk come from?
New Zealand 27.9%
EU 26.0%
US 11.8%
Australia 6.7%
Belarus 4.2%
Argentina 3.7%
Uruguay 2.1%
ROW 17.7%
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Rabobank believes this is credible scenario of trade growth to 2020
Real constraints exist on
growth in low cost regions
EU to provide the major
contribution as quotas come
off
USA will have to play a
bigger role
Meeting market
requirements will be a
stretch
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Corporate responses
Margins have been defended (though pressure still on)
But companies more reliant on trade and acquisitions for growth
Consolidation, emerging market entry, co-op. capital raising remain prominent
A challenge will be to balance the quest for growth and returns in coming years
13
Processors and traders are building farms
Emerging market players: securing (safe) supply in the home market is a priority
14
Buyers are tying up with/acquiring offshore suppliers
While Brazilian companies consolidate
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M&A’s in the global dairy sector in the recent past
Exposure to Italy, Portugal, Romania,
Canada, Russia, South Africa, Venezuela,
Columbia, Paraguay
Nestle acquired Pfizer Nutrition
(Wyeth) for infant nutrition
exposure in emerging markets
Lactalis acquired Parmalat for
exposure to global
markets/emerging markets
Saputo acquired DCI and
Morningstar in US, Warrnambool
Cheese & Butter (new categories
and global footprint)
FrieslandCampina acquired
Alaska Milk in the Phillippines and
dairy processors in Eastern
Europe
Arla consolidated Milk Link in UK
and MUH in Germany
Müller acquired Wisemans in UK
and set up JV with Pepsi in US
Bongrain invested in equity of
Mikaut in Argentina
Fonterra set up JV with A Ware in
the Netherlands, invested in
corporate farms in China
Pepsi acquired Wimm-Bill-Dann
in Russia
General Mills acquired Yoplait
Kirin acquired National Food and
Dairy Farmers in Australia
Mengniu acquired Yashili and
sizeable stake in China Modern
Dairy
…
中国乳业市场 – 需求 b
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One of the world's largest dairy markets and one of the fastest growing
Rising income of currently low income consumers will drive growth of dairy demand into the
next decade
Imbalance in the development of supply chains have led to a series of milk contamination
(deliberate or accidental) scandals in recent years and a rising wave of imports
Circa 80%+ self sufficient and struggling to maintain this level of self sufficiency given the
rapid market growth vs. structural developments in onshore dairy farming
Reliance on imported feed components will make it difficult to increase self sufficiency levels
quickly; with ongoing investments, local supply will rise over time, but at a cost
Product safety will continue to be a concern and will be an important factor in brand value
Trend of premiumisation increases demand for high quality raw milk
China’s dairy market at a glance
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Why is China important?
Source: Various
One of the largest dairy market Milk deficits rising in recent years Demand growing!
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The rural-to-urban income divide has fostered inward focus
711 Million 642 Million
0% 20% 40% 60% 80% 100%
1978
1980
1985
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Urban Rural
Source: China Statistics Yearbook, Rabobank
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
1978
1980
1985
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
US$
Urban Rural
Source: China Statistics Yearbook, Rabobank, Rmb6.22/USD constant for prior years
Urban / rural population balance in China
Urban vs. Rural per capita disposable income
3.1 x
20
Protein-ization as urban, rural migrants climb the income curve
Source: China Statistics Yearbook, Rabobank
Urban per capita consumption by income
0 5 10 15 20 25
Tea
Beer
Fruit Wine
Liquor
Yogurt
Milk Powder
Milk
Eggs
Mutton
Beef
Pork
kg Top 10% Bottom 10%
X 2.5
X 2.2
X 3
21
-
10,000
20,000
30,000
40,000
50,000
60,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
US$m
Other Dairy
Yoghurt
Milk powder
Long-Life/UHT Milk
Fresh/Pasteurised Milk
Flavoured Milk Drinks
Cheese
Infant Milk Formula
Dairy retail sales value in China, by category
Source: Euromonitor, Rabobank estimates
CAGR
’00-’06 ’06-’12
Overall
6.2% 7.2%
19.7% 15.8%
46.6% 9.3%
10.1% 7.6%
31.8% 19.8%
17.5% 18.9%
27.5% 13.7%
Dairy retail sales value quadrupled over the last decade
8.2% -1.8%
18.1% 26.7%
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Infant milk formula shelves in a Shanghai hypermarket
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The Chinese Infant Formula industry in a state of flux
The government’s perception/intention:
Local industry seen as unsafe by consumers
Face issue with ‘suitcase’ imports
Pricing seen as too high
Wants viable local players Government responses to date
Crack down on ‘suitcase’ trade
Forcing local consolidation
NDRC launched a review of monopolistic pricing
Changes to regulations around acceptable supply chain practices
Registration of overseas IMF plants required (May 1, 2014)
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Premiumization Food safety Healthiness/ Functionality
Trends and observations
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Crossovers
Trends and observations: managing costs, new categories
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Anchor UHT milk in China
Retail price equivalent to NZ$4.50-5.00/L
中国乳业市场 – 供应 c
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China’s dairy deficit in the Central, East and South supports farmgate milk prices in those provinces
Dairy demand is
calculated based on
a provinces ‘official’
population
multiplied by per
capita consumption
Source: Rabobank
Note: Dairy demand is calculated based on a provinces ‘official’ population multiplied by per capita consumption. With Shandong’s industries attracting migrant workers from other provinces, dairy demand is likely
higher than the figures show, ie, the deficit is more negative
Henan Gansu
Heilongjiang
Jilin
Liaoning
Hebei
Shandong
Fujian
Jiangxi
Hubei
Hunan
Guangdong Guangxi
Shanxi
Inner Mongolia
Shaanxi
Ningxia
Qinghai
Guizhou
Yunnan
Tibet
Xinjiang
Jiangsu
Tianjin
Anhui Shanghai
Sichuan Zhejiang Chongqing
Taiwan
Hainan
Beijing
Dairy surplus region
(local consumption < local production)
Dairy deficit
(local consumption > local production)
Surplus/Deficit
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Declining self sufficiency in China
Source: China Dairy Association, China Customs, Rabobank estimates
Chinese milk deficit has
experienced a structural lift
post melamine in 2008
The industry is being directed
to build larger, vertically
integrated farms: not without
challenges
We assume that milk
production stabilizes in 2014
Consumption to expand at
low single digit rates
Imports will need to rise by
another 10-20% in 2014 to
balance the market
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China’s dairy farming is under rapid “transfarmation”
Source: China Dairy Statistical Report, Rabobank estimates
Farm Number by Dairy Farm Type Fresh Raw Milk Supply by Farm Type Composition of milk sources
Domestic raw milk
80%
Imported powder 20%
0.0
0.5
1.0
1.5
2.0
2.5
3.0
2008 2011
Million
1-4 heads 5-19 heads 20-99 heads
100-199 heads 200-499 heads 500-999 heads
1000 heads+
-15%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008 2011
1-4 heads 5-19 heads 20-99 heads
100-199 heads 200-499 heads 500-999 heads
1000 heads+
-11% pts
+0% pts
+2% pts
+ 6% pts
+ 3% pts
+ 1% pts
-1% pts
+124%
+102% +47% +18%
+16% -16% -16%
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Structural and temporary developments lead to shortage and soaring milk prices in China
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Imports still attractive – high local milk prices and import preference
Source: Chinese Customs, Rabobank
China - Monthly Milk Powder Import Parity
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Jan
-08
Jun
-08
No
v-0
8
Ap
r-0
9
Sep
-09
Feb
-10
Jul-
10
De
c-1
0
May
-11
Oct
-11
Mar
-12
Au
g-1
2
Jan
-13
Jun
-13
No
v-1
3
Ap
r-1
4
TonnesUSD/tonne
China montly powder import - right axis
Est WMP Import Price (C&F, ex-tariff & VAT)
Est WMP Import Price (C&F, cum-tariff & VAT)
Est Cost of Making WMP in China with Average Raw Milk
Est Cost of Making WMP from Quality Milk Supplied by Corporate Farms
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Imports of key product categories by origin
Source: China Customs Statistics, Rabobank
US and EU: major players in China’s whey import New Zealand: a dominant player in China’s powder import
NZ
86%
Aus
3%
US
3%
Germany
2%
France
2%
Others
4%
US
46%
France
15%
Netherlands
7%
Argentine
6%
Germany
6%
Others
21%
Total import at circa. 378,380 tonnes in 2012 Total import at circa. 578,000 tonnes in 2012
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To build milk capacity, China will continue to import the herd
Source: China Customs, Rabobank 2013 Source: China Customs, Rabobank 2013
Origin of imported cows over the past decade China’s dairy cow imports (heads)
Over 345,000 since 2009, two-thirds of which have come from Australia
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Australia
66%
New
Zealand
31%
Uruguay
1%
Canada
1%
USA
1% South Africa
0%
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The food story driving the feed story
Source: China Customs Statistics
Alfalfa (and pellets) import has been surging since 2008 US is THE supplier of alfalfa to China (2011)
China has become a net importer of corn China has been a major importer of soybean
US 96%
Australia 4%
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
2006 2007 2008 2009 2010 2011 2012
tonnes
-6
-4
-2
0
2
4
6
2006 2007 2008 2009 2010 2011 2012
m tonnes
-60
-50
-40
-30
-20
-10
0 2006 2007 2008 2009 2010 2011 2012
m tonnes
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Challenges and opportunities in China’s Dairy Market
What China Needs/Lacks
Opportunities
Rapid ‘transfarmation’ of China’s
dairy upstream
Eager to boost milk yield and
quality
Technical expertise in managing
large scale dairy farms
Availability of arable land
Environmental protection
Gap between dairy supply and demand
Milk powder
Whey (cheese?)
IMF/Premium/Functional
Liquid UHT milk import?
Breeding technology
High quality dairy cattle feed
Expertise in dairy cattle nutrition
Farm equipment
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China already dominates the global traded market for dairy commodities
Small changes in China’s demand and supply balance have a large impact on the global market
and therefore commodity prices – producers should endeavour to keep up to date with Chinese
market trends
Near term demand slowdown due to pricing, needs prices to be right to lure back demand
Mutual concentration risk exists (particularly between China and New Zealand for whole milk
powder) and diversification will be a mitigating strategy
High milk production costs in China will result in imported product remaining attractive and
continuing to play an important role in fulfilling demand
Regulatory changes in China will continue to impact the supply chain and all participants will
need to keep informed and adapt quickly
Chinese dairy consumers are already sophisticated and place high expectations on milk
producers for quality, food safety and sustainability characteristics – providing a high level of
evidence in these areas will become increasingly important
Implications for producers in and outside China
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Important notice
Rabobank International Disclaimer
This presentation has been prepared exclusively for the Sino-Dutch Dairy Forum in Xi’An on June 13, 2014. Neither this presentation nor any of its contents may be used for any other purpose
without the prior written consent of the Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (“Rabobank” or “Rabobank International”).
The information in this presentation reflects prevailing market conditions and our judgement as of this date, all of which may be subject to change. This presentation is based on public information.
The information and opinions contained in this document have been compiled or arrived at from sources believed to be reliable, but no representation or warranty, express or implied is made as to
their accuracy, completeness or correctness. The information and opinions contained in this document are wholly indicative and for discussion purposes only.
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Contact
Rabobank International
Wholesale Clients International
Sandy Chen
Senior Industry Analyst
Food and Agribusiness Research
(Shanghai Office)
Telephone +86 21 2893 4691
E-mail [email protected]