ASIA Rise in demand for Milk with flavors, organic and natural claims in Asia Pacific April 2021

According to a recent report from Mintel, the dairy (milk) drinks category in the Asia Pacific region has witnessed a rise in launches with organic/natural claims as producers use the label to quell consumer concerns over the safety of dairy production and its impact on the environment.

In addition, flavored milk category is also making a comeback, after struggling with its earlier image of being closely associated with sugary, and targeted mainly for children. Flavored milk producers in Asia are innovating around more adult cues such as added nutrients, interesting textures and more sophisticated flavors. One recent innovation is the use of ruby chocolate in milk in Japan which added that distinctive pink color with a fruity, berry flavor to milk.

China is the most important country in the region with regards to milk consumption, apart from India, and there are growing signs on the ground that Chinese consumers are building back trusts in domestic milk brands, although demand for imported milk brands will still be strong. A recent survey conducted by Mintel showed that 44% of adult Chinese respondents believed that local milk sources are now reliable compared to a lower 36% who perceived them as not reliable.

China’s domestic milk producers are offering more traceability of their products by providing detailed information on ingredients, production source and distribution. To gain consumer trust, milk producers in China also provides information on the filtration process/method used for their milk products on the packaging. For example on the packaging of Jun Le Bao Milk brand, it is written ‘Jun Le Bao Milk is processed according to an instant sterilisation technique which takes only 0.09 seconds to retain the freshness of active protein’. Some other brands wrote the use of ‘advanced French ceramic membrane filtration technique..’ while some insist on their milk products made ‘using selected Herolstein cows from a highland farm and processed using instant freshness locking technique..’. All these positive claims do help to change Chinese consumers’ negative perception of local brands in the past.

The pandemic has basically ‘reawakened’ dairy players in the Asia Pacific region, particularly in China, of the urgency to gain consumer trust through food safety assurances.

With growing sustainability concerns, dairy milk producers in the region are also focusing more on the ‘natural’ aspect of their production as consumers are showing greater interest in dairy products which are produced in a more ‘natural’ way – i.e. using natural ingredients, sourced from organic/clean farm which also has high animal welfare standards. This has also accelerated further innovations in the dairy segment. To prove the above point, dairy drink launches featuring an organic as well as ethical claim have recorded an increase in recent years. (see Chart 2.0).

However, domestic producers in this region are expected to face stricter global standards with regards to organic accreditation in order for their products to be able to export overseas.




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