ÿþ<!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd"> <html xmlns="http://www.w3.org/1999/xhtml"> <head> <meta http-equiv="Content-Type" content="text/html; charset=utf-8" /> <title>Dairy Investment Research-Report-Market Report</title> <link href="/css/w.css" rel="stylesheet" type="text/css" /></head> <body> <table width="780" height="67" border="0" align="center" cellpadding="0" cellspacing="0" background="/images/1bg.jpg" bgcolor="#D0DDED"> <tr background="#D0DDED"> <td height="67" valign="bottom"><table width="780" height="60" border="0" align="center" cellpadding="0" cellspacing="0"> <tr> <td width="262" align="left" valign="bottom"><a href="http://en.chinabgao.com/"><img src="/images/loge.gif" width="162" height="41" hspace="46" vspace="10" border="0" /></a></td> <td width="17"></td> <td width="501" align="right" valign="middle"><table width="485" border="0" align="left" cellpadding="0" cellspacing="0"> <tr> <td width="91" height="31" class="dao01"><a href="/">Home</a></td> <td width="92" class="dao01"><a href="/about-us.asp">About Us</a></td> <td width="91" class="dao01"><a href="/services.asp">Services</a></td> <td width="96" class="dao01"><a href="/contact-us.asp">Contact Us</a></td> <td width="75" class="zi"><a href="http://www.chinabgao.com/">-N‡eHr</a></td> </tr> </table></td> </tr> </table></td> </tr> </table> <table width="780" height="170" border="0" align="center" cellpadding="0" cellspacing="0"> <td height="168" valign="top"><img src="/images/bg.jpg" width="780" height="168" /></td> </tr> </table> <table width="780" height="6" border="0" align="center" cellpadding="0" cellspacing="0" background="/images/jian.gif"> <tr> <td></td> </tr> </table> <table width="780" height="25" border="0" align="center" cellpadding="0" cellspacing="0"> <tr> <td bgcolor="#FFFFFF" style="padding-left:5px;padding-right:5px;"> You are here:<a href="/">Home</a> >> <a href='/food/'>Beverage & Food </a> &gt;&gt; Dairy Investment Research </td> </tr> </table> <table width="780" border="0" align="center" cellpadding="0" cellspacing="0"> <tr> <td width="530" align="center" valign="top"><table width="100%" border="0" cellpadding="0" cellspacing="0"> <tr> <td width="100%" align="left" valign="top" bgcolor="#F4FEFF" class="kuang1"><table width="100%" border="0" align="center" cellpadding="0" cellspacing="0" class="kuang"> <tr> <td align="left" valign="top"><table width="98%" height="27" border="0" align="center" cellpadding="0" cellspacing="0"> <tr> <td align="center" valign="middle" height="10"></td> </tr> <tr> <td align="center" valign="middle"><h1>Dairy Investment Research</h1></td> </tr> <tr> <td align="center" valign="middle" height="28">No:yb09-1104 &nbsp;&nbsp;<a href="http://en.chinabgao.com/">China Report Hall</a>&nbsp;&nbsp; [<a href="javascript:self.print();">Print</a>] &nbsp;&nbsp;[<a href="mailto:?subject=[China Report Hall]Dairy Investment Research&body=I[China Report Hall]see the Dairy Investment Research This report recommended special to you http://en.chinabgao.com/report/reports/200909/1/1104.html" target="_blank">Recommend to friend</a>]</td> </tr> <tr> <td align="left" valign="middle" height="20"><p>[Report Title]: <a title="Dairy Investment Research">Dairy Investment Research</a></p></td> </tr> <tr> <td align="left" valign="middle" height="20"><p>[Keywords]: Dairy Investment</p></td> </tr> <tr><td height="20" colspan="2"><p>[Date]: May 2009</p></td></tr> <tr><td height="20" colspan="2"><p>[Delivery]: EMAIL electronic version</p></td></tr> <tr> <td align="left" valign="middle" height="20"><p>[Price]:<font color="#FF0000">EMAIL electronic version: 26000 USD</font></p></td> </tr> <tr> <td align="left" valign="middle" height="20"><p><font color="#FF0000">[Telephone Order]:<strong>0592-5337135/5337136</strong> &nbsp;&nbsp;<a href="/order.asp?pageno=1104" target="_blank" class="M"><img src="/images/dg.gif" width="15" height="15" border="0" /> <strong><u>Online Order</u></strong></a></font></p></td> </tr> <tr> <td height="20" align="center" valign="middle"><p><font color="#FF0000">[Report Contents]</font></a></p></td> </tr> <tr> <td align="left" valign="middle"><p><br /> <font color="#000000"><P><STRONG>Table of Content</STRONG></P> <P><STRONG>I. Consumer Confidence Index for Dairy Products&nbsp;7</STRONG><BR>1. Consumer Confidence Index of Dairy Industry to See a Rally in 2009 after Touching the Bottom&nbsp;7<BR>2. Research of Dairy Demand&nbsp;9<BR>Driving factors behind dairy demand: population, urban per capita disposable income, rural per capita net income and export&nbsp;9<BR>Per capita disposable income of urban residents: 10.2% growth in Q1 of 2009, the growth continued to slow down&nbsp;10<BR>Per capita net income of rural residents: 8.6% growth in Q1 of 2009, a big rally&nbsp;10<BR>Population: a growth rate of 5 is projected in 2009, with a slowing pace&nbsp;11<BR>3. Research of the Supply of Dairy Products&nbsp;11<BR>Driving force of dairy supply: dairy cattle inventory and price ratio between milk and feed&nbsp;11<BR>Dairy cattle inventory: 12% decline of dairy cattle inventory in Q1 of 2009, and Q2 is foreseen to see steady inventory&nbsp;12<BR>Price ratio between milk and feed: raw milk price was sluggish from the latter half of 2008, and the price ratio between milk and feed lingered around a low level.&nbsp;13<BR>4. Growth of Dairy Production&nbsp;14<BR>Liquid milk production: lowest level in Q4 of 2008, 7.1% growth in Q1 of 2009 than Q1 of 2008, bouncing back&nbsp;14<BR>Output of solid milk: 27% less in Q1 of 2009 over Q1 of 2008, Q3 is foreseen to be steady&nbsp;14<BR>5. Sales Revenue of Scaled Dairy Companies and Growth&nbsp;15<BR>Sales revenue: 3.2% more sales revenue in Q1 of 2009 over Q1 of 2008&nbsp;15<BR>6. Gross Profit Margin of Dairy Products&nbsp;15<BR>Price changes of fresh milk and powder closely relate to CPI, whereas yogurt price is not much related to CPI.&nbsp;16<BR>Dairy price: steady in Q4 of 2008, rally in Q1 of 2009&nbsp;16<BR>7. Total Profit of Dairy Products: Q1 of 2009 Similar as in Same Period 2008&nbsp;17<BR>8. Forecast of Dairy Industry&nbsp;18<BR>The per capita dairy consumption of urban residents was 22.26kg in 2008 and 3.04kg for rural residents.&nbsp;18<BR>The per capita dairy consumption volume in China is much lower than the world average, and the there is a huge market potential in the future.&nbsp;19<BR>Sales revenue in 2009 is hopefully to see 10.6% growth.&nbsp;19<BR>Raw milk supply shall become the bottleneck of dairy industrial development from 2010-2011.&nbsp;19</P> <P><STRONG>II. Dairy Industrial Chain&nbsp;20</STRONG><BR>The average cost of raw milk in the nation is 2.31 yuan/kg, feed cost makes up around 70% of total dairy farming cost.&nbsp;21<BR>15kg of daily milk yield of dairy cattle on average, and the yearly amount was 4.5 tons&nbsp;21<BR>Raw milk is mainly produced in the Northeast, North China and the Northwest.&nbsp;22<BR>Shift from smallholder dairy farming to scaled farming&nbsp;23<BR>Procurement link of milk stations: processing companies pay by quality and decide raw milk price.&nbsp;23<BR>Profit margin of different link: raw milk makes up around 75% of the cost of dairy processing companies, and the profit margin is noticeably squeezed by dealers.&nbsp;24<BR>Core factors for the success of a dairy processing company are capability in controlling raw milk, capability in quality control and capability in market promotion.&nbsp;25</P> <P><STRONG>III. Competition of Dairy Market&nbsp;25</STRONG><BR>75 billion yuan of sales revenue of liquid milk in 2008, slightly higher from 2007&nbsp;25<BR>Output of liquid milk: production and sales volume in 2008 was the same as in 2007.&nbsp;26<BR>UHT milk output saw negative growth for first time in 2008&nbsp;27<BR>The growth of the output of pasteurized milk slowed down in 2008, but still 3% growth.&nbsp;28<BR>The output of yogurt grew by 4% in 2008, still enjoying the fastest growth among dairy products.&nbsp;28<BR>Production and sales of main liquid milk producers&nbsp;29<BR>17.6% less production of solid milk (including powder, condensed milk, milk fat and cheese) in 2008&nbsp;29<BR>65 billion yuan of sales of powder in 2008, a recovery growth is likely in the 3rd quarter of 2009.&nbsp;30<BR>Update of production and sales of powder of key companies&nbsp;31<BR>Analysis of advantages and disadvantages of dairy companies&nbsp;32</P> <P><STRONG>IV. Import and Export from 2006-2008&nbsp;34</STRONG><BR>Dairy import is mainly powder, condensed milk and whey, powder import accounts for around 8% of the national production.&nbsp;34<BR>Source of powder import: New Zealand, Australia and the US are the three main suppliers of milk powder to China.&nbsp;35<BR>Source of import of whey: the US, France, the Netherlands and Finland are the main suppliers of whey to China.&nbsp;36<BR>The export of dairy products is mainly powder, condensed milk and fresh milk, the export of fresh milk is less than 1% of the national production.&nbsp;36<BR>Venezuela is the largest importer of milk powder from China, and Hong Kong is the largest importer of fresh milk.&nbsp;38</P> <P><STRONG>V. Yili: Fill up the Blankness of Sanlu and Becomes New Leading Player of Milk Powder&nbsp;38<BR></STRONG>12% growth of sales of liquid milk in 2009 is projected.&nbsp;38<BR>To become new leading player of milk powder by filling up the blankness of Sanlu&nbsp;39<BR>Forecast of Yili&nbsp;39<BR>Listed dairy companies&nbsp;40</P> <P><STRONG>VI. Interpretation of Dairy Policy&nbsp;41</STRONG><BR>Raw milk procurement stations for the first time are included in the range of subsidy for agro-machinery.&nbsp;41<BR>Technical Norms of Standardized Management of Raw Milk Procurement Stations ensures safety at procurement link of dairy products.&nbsp;41<BR>Planning of competitive dairy farming regions shall further heighten the concentration level of raw milk production.&nbsp;42<BR>Implementation of the Food Safety Law further regulates the quality and safety of dairy products.&nbsp;43</P> <P><STRONG>VIIImpacts from Melamine Incident on Dairy Industry&nbsp;44</STRONG><BR>Raw milk production converges towards mechanized and scaled production&nbsp;44<BR>Dairy processing companies tend to extend industrial chain so as to guarantee quality and safety of milk from the source.&nbsp;45<BR>Import and export: decline of export but enlargement of import&nbsp;45</P> <P>&nbsp;</P></font><br /> </p></td> </tr> </table></td> </tr> </table></td> 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