China’s milk and dairy beverages retail market saw a higher growth rate in 2020 than the previous year, even with the pandemic taken into account, driven by both value and volume. The macro environment for this market will stay positive in the near future, but the threat from the yogurt sector needs close attention.

A number of mergers and acquisitions keeps the whole industry centralised, expanding channels and product portfolios from key players. With IPO fever, competition will be fiercer.

Chilled plain milk enjoys the highest growth rate, while ambient plain milk still leads by market value. Lactobacillus sees a weaker growth due to loss in foodservice.

In the near future, emerging consumption occasions and policies will drive market growth and bring new opportunities to a wider beverage market.

• Market factors from both consumer and market side

• The value of market segments in 2020

• Competitive strategies in mergers and acquisitions, product portfolio and channels

• Global and China launch activity and product innovation

• Consumers’ perception about lactose-free, pasteurized milk, UHT milk, etc

• Market growth opportunities through emerging consumption occasions, function aspects and in the bigger beverages market

This Report covers plain liquid milk, powdered milk, flavoured milk and lactobacillus beverages. Flavoured milk products discussed in this Report should have no less than 80% milk content and no less than 2.3g of protein content per 100g/ml.

Lactobacillus beverages are defined as dairy-based drinks fermented using lactic acid bacteria, with less than 2.3g protein content per 100ml. These drinks usually contain sugar or sweeteners, acids, juice and plant extracts.

The following are excluded from market sizing but discussed in the context of competition and consumer trends where relevant: condensed, evaporated, sour and cultured milk; soymilk and other plant-based milk; milk specifically for babies (infant milk formula); drinking yogurts; acidic milk drinks, eg Nutri-Express (营养快线) and Suan Suan Ru (酸酸乳); lactobacillus water fermented using lactic acid bacteria.

Plant-based drinks (dairy alternatives) are excluded in this Report and will be discussed in more detail in Mintel’s upcoming Plant-based Drinks – China, April 2021 Report.

For the purpose of this Report, Mintel has defined those consuming dairy beverages ‘once a day or more’ as heavy users, ‘2-6 times a week’ and ‘2-3 times a month’ as medium users, ‘once a month or less’ as light users, and those who have not consumed it in the last three months as non-users.