Yogurt market can hit $1bn by 2021 in India: Report

The report says the yogurt market in India grew at a CAGR of 28.9% between 2011 and 2015. And the country's yogurt market is projected to grow at an even faster pace over next five years and touch $1bn by 2021. Easy availability of products, and rising emphasis on low calorie and low fat content of food products is driving yogurt consumption in India. Yogurts are gradually eating away the share of traditional dairy products in urban and semi urban cities, due to increasing health awareness, better quality of packaged yogurt and increasing yogurt flavors. Most production not organized With growing yogurt demand and only a handful of organized players offering yogurt, the prices of these products are anticipated to grow through 2021, the report says. Currently, around 80% of India’s dairy production comes from small enterprises, with an average herd size of only one or two cows. The larger, organized, Indian companies and cooperatives have been attempting to combine small localized production to ‘demand centers’ across the country. Shift to organized dairy companies Laltu Sinha, research manager with TechSci Research, told DairyReporter that the industry is changing. “The Indian dairy products market is expected to witness a shift from unorganized to organized sector,” Sinha said. “The rise in the organized sector in India dairy products market can be attributed to rising demand for high quality packaged products, especially in urban areas. However, in rural areas, acceptance of packaged dairy products is slowly gaining momentum. “However, the dairy market is highly fragmented with the top ten players occupying less than 60% of the market share.” Major milk coops dominate The yogurt market is driven by various major milk co-operative societies, Sinha said. Gujarat Co-operative Milk Marketing Federation Ltd, Mother Dairy, Punjab State Cooperative Milk Producers Federation and Karnataka Cooperative Milk Producers Federation Ltd all supply their products to more than four states. Foreign companies can make inroads Sinha said that the Indian yogurt market does have some foreign influence. “Rapidly changing lifestyles influenced the younger generations in India to adapt to newer products such as yogurts, probiotic drinks, etc. Consumers are emphasizing the quality of the products. “It will give an edge to international players over regional players in the yogurt segment and establish them in India dairy market. So far, only few companies have a presence in the yogurt market.” Sinha said the five companies are: Nestlé, Danone, DSM, Red Mango and Yogurberry. “Foreign players have to very innovative, which will help them to get a position in the India Dairy market. Companies are suggested to improve their local presence through various mergers and acquisitions as well as improving their supply chain. “The product is gaining popularity in India due to the entry of a number of organized players in the market,” he said. Demand for healthy products Consumers prefer new flavors in yogurt, Sinha said, but he added that the flavored yogurt market is still in its infancy and growing. Sinha said the most popular flavors are berries such as strawberry and blueberry. Other popular flavors are mango, vanilla and chocolate. As flavored yogurt consumption is on the rise, so is the demand for healthy products. “The demand for probiotic and low fat yogurts has increased due to rising awareness about these products especially in urban areas,” Sinha said. He added that consumers are looking for healthy options, and products that fall into the category are generally met positively. Factors driving demand Clean label is becoming important in the country, and yogurt is no exception. Companies are increasingly adopting clean label to improve their brand image in the dairy market, Sinha said. Sinha noted that rising awareness about the health benefits of products, increasing disposable income levels, growing demand from the middle class segment, and affordable prices, are driving demand for yogurt in India. "India Dairy Products Market By Product Type, Competition Forecast & Opportunities, 2011-2021'’ looks at the future growth potential of the market and provides statistics and information on market structure, size and trends.

Yogurt market can hit $1bn by 2021 in India: Report

International dairy companies can tap in to a growing demand for yogurt in India, according to a recently-published report by TechSci Research.

Related Topics