Food & Beverage News: Top Stories - Victoria diary sector looks for niche opportunities in Indian dairy space

Victoria, Australia’s premier dairy state, is keen to foray into the Indian market. It is scouting for collaborations, joint ventures, technology transfer and co-marketing efforts. In this regard, the Victorian Agribusiness Group, Department of Primary Industries delegation, was here in the country to ascertain the potential opportunities which it could tap.

The Victorian Dairy Trade Mission to India visited India between November 22–27, 2009. They are having discussions with the Indian diary industry at Bangalore, Hyderabad, Mumbai and New Delhi. As part of the mission, there are six companies: Bemco Australia, Longwarry Food Park, Tatura Milk Industries, Fresh Cheese Company and Ballantyne Foods.

The State of Victoria is known for its high quality, innovative and diverse range of dairy products. It accounts for 80% of Australia’s dairy export. “We are here to have a dialogue with various dairy cooperatives and private dairy firms,” Peter Myers, manager, Victorian Department of Primary Industries, International Market Development- Emerging Markets, told F&B News.

”The key objective of our visit is to promote Victoria’s dairy products and also to transfer high standard technology and share their expertise for world class dairy products. This collaboration, apart from boosting India–Australia trade ties, will enable Indian companies in the field to have easy access to world class Ballantyne butter tubs, wide range of Italian cheese style, Longwarry’s full cream milk powder etc. in their own country”

“ We are also looking at taking our range of value-added products to the Indian retail space,” he added.

One of the products from Victoria which could interest the Indian retail sector is yoghurt. The delegation is looking to market a product which is similar to European yoghurt but different from Indian curds.

The Indian government has insisted that imported dairy products should be free from estrogen. The dairy majors from Victoria have proved that and certified for trade.

India has always been an important hub for the dairy markets globally. The country is known for its highest milk production in the world. The increase in demand for milk and milk products is attributed to the growing population and dual income homes. This has lured the Victoria Dairy Trade Mission to explore this home market. But our interest are to tap the niche segment where trade mission is looking to enhance the quality of the dairy products, stated Myers.

In Karnataka the delegation met up with the Karnataka Milk Federation Mother Dairy for a possible co-marketing and co-branding opportunity.

Delving in the area of interest which could bring in possible alliances are methods to increase animal population in the farms here. While in Victoria a typical dairy farmer will have a minimum of 200-300 herd population, in India it is a mere 2 or 3 animals. The trade delegation also keen to offer its expertise in tropical diary farming.

Victoria has already made inroads into the emerging markets of Indonesia, Vietnam and other South East Asian countries. India attracted us by its capability in achieving the highest milk production. The key strengths of Victoria dairy sector are high per capita production, quality safe products, and wide range of value added products. There are also several dairy technology transfers which can benefit Indian dairy sector.

In Australia, dairy is the third largest industry after beef and wheat. There are over 5,500 dairies in Victoria. The region is known for its teams of efficient farmers, high productivity and herd management. The farm value of the dairy sector is Aus $ 4.6 billion. The state has a population of 1 million cows.

Further Victoria has a smaller population and only 10 per cent of the milk is consumed and the remaining 90 per cent is exported. A majority of this milk is processed. The biggest single category of processed milk products are cheese, yoghurt, ice-cream and functional foods.

The largest exports go to Japan followed by the US, Europe, Middle East, Asia which covers Singapore, Indonesia, Malaysia, Thailand, Philippines. It is now in the process of developing the markets of China and Vietnam.

“The biggest challenges in the Indian market are the 30 per cent tariff on dairy products. The value added specialty products are sensitive to temperature and therefore the lack of a cold chain support is also an issue. However, there are alternative technologies for perishables which we are looking at once we get a chance to export milk products here,” he added.