Dairy index: Global milk demand to overtake supply

Population growth, rising prosperity and urbanisation boost demand.

LAHORE: Tetra Pak, a food processing and packaging company, has highlighted in its seventh dairy index the opportunities and challenges posed by rising global demand, which is set to overtake available supply over the next decade.

According to the company, the producers in both developed and emerging dairy markets including Pakistan need to consider that the careful balancing act requires sustainable business success.

Estimates suggest that global demand for milk will surge 36% over the next decade, largely due to population growth, rising prosperity and urbanisation in Africa, Latin America and Asia including Pakistan.

However, the milk supply and demand shows an imbalance across the world. Rising demand in emerging dairy markets is unlikely to be met by local raw milk producers, while developed dairy markets, which are producing surplus milk, face the challenges of competing for exports, which corresponds to falling domestic consumption.

“The predicted surge in global demand offers a huge opportunity for dairy companies in developed markets to export powdered and liquid dairy products to growing economies,” said Dennis Jonsson, President and CEO of Tetra Pak Group.

“However, to ensure long-term success, these producers need to balance the ‘quick wins’ of export against the requirement.”

Published in The Express Tribune, October 3^rd, 2014.

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