Rise in Demand and Use of New Distribution Channels to Drive Indonesia Dairy Food Market over the Forecast Period: Ken Research

Indonesia’s dairy food market industry is experiencing an affluent rise in demand and a substantial annual growth due to a shift in consumer habits and population growth. The country’s dairy sector functions on two diverse ends of the production spectrum. At one end, there is slight, yet growing group of fresh, efficient, and incorporated dairy corporations, while another end has well-developed production facility and high demand. Indonesia presents substantial business opportunities in the dairy food market both for upstream and downstream covering the shortfall in milk supply, as well as introducing to the new products and ways that appeal to the rise in health consciousness of the market.

Dairy market Indonesia

Improved coordination among Indonesia’s dairy cooperatives and independent farmers introducing up-to-date production methods that are crucial to developing the additional dairy capacity. The efficacious execution of new measures coupled with Indonesia’s wide availability of appropriate land and labor for cattle farming is also adding new opportunities for the market. Indonesia is also witnessing an increase in a number of dairy cattle, leading more productive ways of cattle breeds and ensuring that the cooperatives also play a role in the socialization of new and advanced methods of production. The new age population is also concerned for the use of functional foods and protein consumption driving the innovation and demand of the Indonesia dairy food market.

In Indonesia, cheese usage in food service have always been higher, while usage of cheese in retail has also been increased nowadays. Improvements in transportation, infrastructure and establishment of cold chain supply management. Enabling the dairy producers and supply chain companies to reach beyond the traditional developed centers of the country’s main and outer lying islands. The usage and demand of fresh milk and have been increased in recent years, moreover rise in interest towards flavored milk drinks is further supporting the dairy demand in Indonesia. Over the past some year there also have been a stronger rise in volume growth and value growth, supported by more and new products entering dairy market owing to increase in concerns for health and wellness based on education and awareness and the government supports measures by easing tax and import policies with an objective to boost domestic dairy production.

The key players associated with new forms of milk as dry and condensed are also putting substantial efforts into designing new packaging for all types and sizes meeting the demand associated with the different occasions and uses. The dairy products like yogurt and probiotic yogurt drinks are a new product which may further benefit from the rise in demand trend, as and when they gain popularity among Indonesian consumers. The country is also registering a rise in demand for cream and coffee whiteners in the food service channel, and demand in the new channel have also been increasing due to rise in a number of cafés and bakeries in the country. The use of other forms of coffee such as instant coffee, is attractive and prevalent in Indonesia making it an attractive hub for the manufacturing of dairy products, as long as that adequate raw material sourced from domestically developed dairy farms. The country is also observing variation in trends associated with healthy and clean labeled products.

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Ken Research

Ankur Gupta, Head Marketing & Communications




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