China's milk market 2015: little increase in production - import slump - stock removal
Reduced China's milk product imports have triggered a decline worldwide in addition to the Russia import ban in milk prices. The price was also that is why so much, because the development of imports signaled a growing import demand. Chinese milk powder imports rose 6 years more than three times; the total Dairy imports have sixfold. The Chinese demand led to high milk prices, which animated in the production areas to the expansion of the milk production worldwide. Only the EU has been hampered by the then applicable quotas.
Starting with the 2nd half of 2014 China reduced its imports to the tune of 30% to 60% depending on the product. Sufficiently high inventories and a weaker income growth were considered reasons.
An expected recovery recovery of Chinese purchases from abroad has been shown only to limited extent. It remains at the levels below the already depressed last year line.
The recent exchange rate adjustments reduce the purchasing power of Chinese currency with the expected result that the willingness of import remains still throttled.
In the own country raised relatively little movementhave reduced China's milk product imports. Those who believed that the missing imports be compensated by the increase in domestic production, looks forward to an alternate reality. The number of dairy cows has changed very little. The milk yield per cow increases though, but remains at a low level. The total milk production in 2015 is only little about the increasing development of previous years. A compensation effect for the missing imports is not visible.
The weak points of Chinese milk production exist once in the just the available forage areas. Good locations are urgently needed to produce market fruit. Extensive locations are market remote in the outskirts to the Chinese or Mongolian desert.
The 2nd problem is the logistics of milk is associated ranging from consumption oriented processing, transport in the metropolitan areas bordering the coast to significant parts. Closed cold chain are available only in approaches. Imports in the cities middle of port generally are cheaper than the overland route from the Interior of the country.
On the consumption side dominated the fresh milk consumption but mostly to spatially limited domestic supply. The production of milk powder prevails on the market sites that has for 2015 but little growth. Skimmed-milk powder production plays a minor role, because little butter is produced. This also applies to the small cheese-making in China.
The ultimate market milk powder custom originated in previous years about half of imports and domestic production. Now to be observed breaking the VMP-imports and slight increase in own generation suggests that would be offset of the rebuilt stock reserves. The VMP consumption increases significantly less than in recent years.
In contrast to previous years China currently no inventory stocks more but operates only a brief replacement. That explains the last time the restrained import policy for the coming foreseeable months.
