Milking opportunities: new market for Victorian dairy producers

Milk from Gippsland and cheese from the Yarra Valley may soon be seen on supermarket shelves in India following the release of a Victorian government report into export opportunities in the lucrative Indian dairy market. This follows the lifting of India’s six-year ban on dairy imports from Australia.

India is a substantial consumer of dairy products and, with a growing affluent middle class, research has identified increasing demand for specialty dairy products such as ice-cream and flavoured yoghurt, products the Indian milk sector does not currently manufacture in large quantities.

The report, Market Opportunities in Indian Dairy Value Chain, identifies areas of significant commercial opportunity for Victorian businesses operating in the dairy industry and also identifies vital market-entry strategies for each opportunity.

Prior to India banning importation of Australian milk products in 2003, Victoria had supplied up to 80% of Australian milk exports to that country, worth around $6m annually to the Victorian economy. It is estimated that this amount will be fast exceeded as Victorian businesses develop confidence in the renewed market access to the Indian market.

Key export opportunities

India is currently the world’s largest producer of milk, with more than half of the 106 million tonnes of milk produced annually consumed in liquid form. The majority of the remaining milk is consumed in the form of traditional Indian dairy products such as ghee, paneer, chhana, dahi and other sweets.

The report identifies a growing demand for high-quality, western-style dairy products, and states that markets for specialty dairy products, milks and cheeses will be the most immediately accessible for exporters from this state. Although a number of western countries are currently exporting dairy products to India, Victoria’s proximity to the Indian subcontinent and quality dairy products are significant factors in its favour.

In addition, the report identifies a number of other areas such as processing and breeding technologies, healthcare, feed and herd management that have been identified as having significant potential for Victorian business.

Key dairy export opportunities include:

• Commodity products - skim milk powder, whole milk powder and cheese spread
• Specialty products - specialty cheese, premium ice-cream, flavoured yoghurt
• Bovine semen - particularly Holstein-Fresian and Jersey varieties
• Second-hand processing equipment
• Cattle feed - including licks and protein feed
• Dairy extension services - feed and nutrition, healthcare and vaccination, artificial insemination, record keeping, available to farmers at farm doorstep.