Dairy UK today published "The White Paper 2012" – a report on the UK dairy industry.

The report reveals:

  • 99% of people regularly consumed milk and dairy products (up from 96% in 2010).
  • 96% regularly drank fresh milk (up from 94% in 2010)
  • 95% regularly ate cheese (up from 90% in 2010).

Liquid milk, cheese and fresh product markets continue to grow. Kantar Worldpanel estimates the UK dairy market to be worth £10.12 billion annually, accounting for 12.4% of food and drink sales.

The UK is the third largest milk producer in the EU and the ninth largest in the world.

Milk production continues to rise and UK dairy companies more than match their EU competitors' investment in product innovation. Annual capital expenditure by the UK's major dairy companies has soared to £210 million.

Dairy UK Chairman Robert Wiseman said that the industry was on the threshold of major structural change, driven by the continuing deregulation of EU legislative regimes.

"All the evidence suggests that we are preparing for the future in the right way", said Mr Wiseman. "We are investing in competitiveness, through rationalisation and the attainment of scale – right across the supply chain. We are securing stronger international links, and our product profile is changing to allow us to exploit the opportunities which, increasingly, the free market will provide for us.

"We anticipate new trading relationships emerging from developments, such as the EU Dairy Package, and we are working as an industry to see how these can be implemented in our best interests."


Begg calls for labelling framework

Addressing the All Party Parliamentary Cheese Group at a reception in London last night, Dairy UK Director General Jim Begg urged the Government to support a labelling framework that would allow the industry to respond to changing consumer demands.

"Although we have some of the best cheeses in the world in our current portfolio, more than 700 of them in fact", said Begg, "we are constantly developing new products, and variations to traditional products, in response to consumer demand. And it will be our ability to respond to changing consumer preferences that will be pretty fundamental to our ongoing success.

"What this industry needs from Government is a benign legal environment that allows us to respond to the consumer. As we go forward through issues such as the European Regulation on Nutritional and Health Claims, and the Food Information Regulation, we want to avoid restrictive labelling laws hindering product innovation and development, whilst maintaining traditional varieties."

Begg also stressed the opportunities for the industry to share in the long term growth in global demand for dairy products, predicted by analysts to be around two and a half per cent annually in the next 5 years.

"Most of this growth will be in the east" said Begg, "particularly China, where growth of five per cent is forecast. In the European Union, and the western economies, it's going to be tougher, but our products remain hugely popular with consumers and growth is our objective."



The UK dairy processing industry has reduced its carbon emissions by an impressive 28%, or nearly 75,000 tonnes a year, since 2000.

Data collected by Dairy Energy Savings (DES), which runs the dairy sector Climate Change Agreement (CCA), also shows that in the last 12 months alone, UK dairy processors have achieved a significant 2% reduction in carbon emissions and a 2% improvement in energy efficiency.

DES Chairman Gerry Sweeney said: "The CCA has been a great success and these results show yet again that the scheme continues to drive improvement in the dairy sector."

Mr Sweeney continued: "Whichever way you look at it, a 28% reduction in annual emissions is an enormous achievement. These latest figures show that the industry continues to take its environmental responsibilities very seriously and is maintaining momentum in pushing for further improvements."

Commenting on the Government's decision to extend the CCA scheme, Mr Sweeney said: "This is good news for the industry and good news for the environment. Whilst some details of the scheme are still under review, I feel confident that we will see a scheme that can provide a catalyst to further improvements, whilst leaving the industry with the flexibility to invest."

Energy improvements in the processing sector echo the wider commitment and achievement of the dairy industry, which continues to work on sustainability initiatives such as the Dairy Roadmap, Dairy 2020, DEFRA's Green Food Project and the International Dairy Federation's Global Dairy Agenda for Action.


Innovation must lead, but consumer acceptance is key

Speaking from the Chair at the Dairy NPD Conference in Amsterdam today, Dairy UK Director General Jim Begg told delegates that against a background of a positive market, innovation, new product development, and R & D must drive industry growth in the future. However, acceptance of new technologies by consumers was necessary to sustain the industry economically.

"Globally, demand for milk could outstrip supply in the next few years. Milk production is most developed in the West, but demand is growing fastest in the East. Market volatility is likely to escalate and already commodity markets are challenging added value markets in generating the highest returns. All these factors need to be considered," said Begg, "but within this it is vital that innovation is rewarded by the market.

"However, because of the sheer size and importance of our industry, and the fact that our products are consumed in almost every household, we are an industry that is constantly subjected to the most intense scrutiny, whether for our stewardship of the countryside or the products we bring to market.

"This means that we have to work hard, probably more than many other what you might call manufactured food products, at communicating the scientific development of dairy production, and dairy products, to consumers and Governments. "And, as I say to my scientific colleagues all the time, there is sometimes a belief that once the science has been established, that's the end of the story. That's wrong, it's only the beginning."

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