Abstract:From the perspective of the market size of the mainland milk powder industry, affected by the growing market demand for infant milk powder and the increase in demand for high-end products, the retail market size of the industry has generally maintained stable growth, and the market size of other milk powder has generally maintained a fluctuating trend, which has rebounded slightly in recent years. In 2022, the size of China's milk powder retail market will reach 441.355 billion yuan, a decrease of 3.5% from 2021, of which the market size of infant milk powder will reach 322.165 billion yuan, and the market size of other milk powder will only reach 109.19 billion yuan.
1. Definitions and Classification
Milk powder refers to the powder made by freezing or heating to remove the water in the milk and dry it, which is collectively referred to as milk powder and daily is called milk powder. The basic nutrients in milk powder mainly include protein, fat, sugar, minerals and vitamins, in addition to adding other nutrients according to different target groups, such as DHA, ARA, prebiotics, lecithin, nucleotides and calcium added to infant milk powder, iron, folic acid and so on added to pregnant women's milk powder, and calcium added to elderly milk powder to reduce fat content.
Second, industry policies
The state has successively introduced a series of policies and measures to improve the quality and competitiveness of domestic milk powder and promote the high-quality development of the dairy industry. The policy priorities include the implementation of quality improvement, industrial upgrading, brand cultivation action plans, optimize the industrial structure, enhance the industry concentration and technical equipment level, enhance product competitiveness, and urge enterprises to implement the main responsibility, improve the quality and safety level of dairy products. In addition, the newly revised infant formula standards will further improve the nutritional effectiveness and safety of products, and promote the development of the industry in the direction of higher quality. In the future, with the upgrading of consumption and the growth of market demand, the mainland milk powder industry is expected to continue to maintain a stable growth trend and become an important force in the global milk powder market.
Third, the development process
The development process of the milk powder industry in mainland China can be summarized into four stages: start-up period, expansion period, trough period and growth period. In its infancy, the milk powder industry started with nationalization and industrial production. In the expansion period, with the deepening of reform and opening up, the domestic milk powder industry ushered in great development, but there were also undesirable phenomena such as counterfeiting. The "melamine" incident in 2008 became a "watershed" in the development of the industry, and domestic milk powder fell into a crisis of confidence. Since 2009, domestic milk powder has entered a period of recovery and growth, although the recovery is slow, but with the upgrading of consumption and technological innovation, the market scale continues to expand, and the brand competitiveness and market share have gradually increased.
Fourth, industry risks
1. Trust risk
Melamine and other incidents have led to a significant decline in consumer trust in domestic milk powder, and consumer confidence in domestic milk powder has fallen to the "freezing point", forming a so-called "trust crisis". This has left domestic milk powder in a difficult situation in the market, with sales plummeting and consumers turning to foreign brands or imported milk powder. In addition, these events have also triggered the rectification and restructuring of the industry, many small and medium-sized enterprises because they can not cope with the risk and withdraw from the market, the industry concentration has gradually increased, up to now, the risk event still has a profound impact on domestic milk powder, so that enterprises are facing huge challenges in restoring market trust and enhancing brand image.
2. Consumption concept risk
As consumers become more concerned about health and nutrition, they are paying more attention to quality, safety and nutritional content in the choice of milk powder. This prompts enterprises to increase R&D investment and improve product quality, but also increases the cost pressure of enterprises. In addition, consumer demand for organic, natural, additive-free and other high-quality products continues to grow, and the favor of imported milk powder has further squeezed the market share of domestic milk powder. This change in consumption concept has led to intensified market competition, price wars and promotional wars have become the norm, and the profit margins of enterprises have been compressed.
3. Security risks
Since milk powder is the main food for infants and young children, its safety is directly related to the healthy growth of the next generation, and the state has continuously strengthened the supervision of milk powder, which puts forward higher requirements for the production standards and quality control of enterprises. At the same time, consumers are also paying more attention to the safety of milk powder, and their requirements for quality and brand are constantly improving. This makes it necessary for companies to strengthen their own quality management systems to ensure that the entire process, from raw material procurement to production and sales, meets safety standards. Only in this way can we regain the trust of consumers and gain a foothold in the fierce market competition.
4. Risk of fertility decline
Affected by factors such as the degree of urbanization, the cost of living and cultural customs, the overall fertility willingness of residents has declined. According to the National Bureau of Statistics, the number of newborns will drop to 9.02 million in 2023, and the number of births has decreased for seven consecutive years. The decline in the number of births will lead to pressure on the milk powder industry, which is mainly consumed by the newborn population aged 0-3. Despite a series of measures to encourage childbearing, the birth rate has not yet shown significant signs of improvement.
Fifth, the industrial chain
The upstream market participants of the industrial chain of the milk powder industry in mainland China are suppliers of raw materials such as fresh milk, whey powder, starch syrup, soybeans, etc., and the main body of the industrial chain is the production and manufacturing of milk powder, which can be divided into infant milk powder, middle-aged and elderly milk powder and pregnant women's milk powder according to the product type, among which infant milk powder accounts for the highest proportion, and the downstream of the industrial chain involves sales channels and consumers, mainly through supermarkets, specialty stores, pharmacies and e-commerce platforms and other channels to mid-end consumers, which can be divided into offline channels and online channels, and offline channels still occupy a dominant position at this stage.
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