The white milk market saw good growth during the base year (2015). While all milk formats saw volume growth, the overall market was bolstered by a substantial increase in the consumption of long-life (UHT) variants in particular.
In terms of value, the category saw a less than inflation increase in the average per-litre pricing. Although rising input costs and the drought put farmers under pressure to supply the market at acceptable prices, there was ultimately an oversupply of UHT milk in the market, some of which was imported. This oversupply resulted in downward pressure on prices, as suppliers sought to maintain their market share within a very competitive environment.
The retail sector is the primary consumer of white milk; this sector saw an increase in share during the base year. All sectors of the market saw growth in 2015, with the exception of exports. However, this comprises a small proportion of the market and didn’t have a negative impact on the market at large.
In terms of packaging, the mainstay of the white milk market is the one-litre carton, a key representation of the UHT category. The second usage tier features the two-litre rigid plastic bottle, which is destined primarily for pasteurised milk. While the one-litre carton saw growth during 2015, two-litre rigid plastic volumes remained fairly static.
All regions saw growth in milk consumption during 2015, although the Free State tended to lag behind the other provinces in this regard. Overall, the milk market is expected to show positive growth in 2016. – BMi Research Report