As rural residents drink more milk, the dairy market grows

by ,http://vietnamnews.vn/economy/538222/as-rural-residents-drink-more-milk-the-dairy-market-grows.html11 November 2019 Last updated at 08:01 AM

Nguyễn Thị Duyên, 35, from the rural commune of Đức Thượng in Hà Nội, spends an extra VNĐ500,000(US$21.5) on milk after her 11 year-old son was said to be “shorter than others” in his class.



Rural consumers are buying more milk.— Photo boom.com

Duyên told Việt Nam News: “I should have bought milk for him earlier.” However, she was unable to as she was away from home for the last five years, leaving the boy to be looked after by her parents-in-law.

“As rural people, we don’t often consume milk,” explained Duyên’s mother-in-law. Things changed when Duyên came back from HCM City where she worked as a domestic helper. Seeing the city kids growing tall and finding her son not as tall as others his age, Duyen started purchasing milk.

The Vietnamese fast-moving consumer goods (FMCG) market has hit a new record of 10 per cent growth in rural areas, the highest in four years, according to market research consultant Kantar Worldpanel.

Kantar Worldpanel said in its latest FMCG Monitor edition, released on October 31, that the national economy continues to present positive indicators for the third quarter of this year, with robust gross domestic product growth.

The consumer price index was still curbed at a low level, recording the lowest nine-month average increase in the past three years. In addition, retail sales of consumer goods maintained double-digit growth.

The local FMCG market growth in rural areas and four major cities – Hà Nội, the central coastal city of Đà Nẵng, HCM City and the Mekong Delta city of Cần Thơ – shows an impressive movement over the long term, nearly twice the pace of last year, thanks to the increased volume. Besides the solid performance of personal care products in both urban and rural markets, dairy products have also been catching up in the third quarter, especially in rural areas.

Ready-made-milk is among the top ten best-selling food items in Việt Nam in Kantar’s latest survey of three months ending by September.

Nguyễn Huy Hoàng, Commercial Director at Kantar told Việt Nam News: “It is positive to see milk consumption increase in rural areas, as it shows that they pay more attention to the children.”

Duyên’s story is not something new in the domestic market, where about 70 per cent of the 100-million-population live in rural areas. 

As a market observer, Hoàng adds: “It is a great opportunity for milk producers that are growing in Việt Nam.” 

Coupled with the positive performance of dairy products, drinking yogurt has recovered in the cities and is seeing accelerating growth in rural areas, mainly by winning back consumers. This category still has room to expand its consumer base and increase consumption volume.

The dairy industry's revenues grew at 12.7 per cent a year on average in 2010-18, and the momentum is expected to continue thanks to an increase in milk consumption in the country, according to the Viet Nam Dairy Association (VDA).

VDA said the consumption of milk per capita in Việt Nam has increased more than 2 times since 2010, but it is still low compared to regional countries. It is still lagging behind Korea, China and Thailand.

Total revenue of the dairy industry in 2018 reached over VNĐ115 trillion ($4.95 billion). —VNS



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