Milk production world-wide Results of IFCN research work 2000 - 2012
Source: IFCN Dairy Report 2011 + 2012 + 12 years cooperation of dairy researcher from over 90 countries. Contact:
[email protected], www.ifcndairy.org
Idea & goal of this presentation 1. Get into the topic + have the basic facts about global milk production using our world dairy maps 2. Illustrate how we can create a better understanding of milk production by explaining it 3. Tool kit – the slides will be sent to you to use for your dairy stakeholders, university lectures, dairy farmer meeting, etc.
© IFCN 2013
IFCN World Dairy Maps – a tool to create a better understanding of milk production world wide
© IFCN 2013
Outline 1. Milk prices 2. Milk processing + demand
3. Milk production 4. Farming systems + costs
Annex 1: What is IFCN Annex 2: Dairy Pictures
© IFCN 2013
IFCN‘s new world milk price indicator World market price of milk 1996 – 2012
70 2013 Turkey
60 31 €/kg
50
17.1 US-$/ cwt
40
2008
2011
Farmers: The key driver for his farm economics + perspectives
30
10
Why is the milk price important
2007
2010
20
Relevance of this price This price is the key driver for every country’s milk prices
2006 Poland
2009 Sweden
2012
Processors: Milk counts for 80% of the costs for a dairy product Farm input suppliers: Their business depends on this price Policy makers: Can get nervous?
Researchers: We can help with knowledge from this conference
© IFCN 2013
Source: IFCN Database 2013
World milk prices drive national prices Monthly milk price developments 2006 - 2013
© IFCN 2013
Source: IFCN Database 2013
Milk surplus and deficit world-wide 2010
The key driver for world milk prices Milk surplus and deficit by dairy region 2010 Moscow
DE UK NL
10.4
ID
WI
IE FR
EU-27
IM
IT
HL
CA FL
Rio de Janeiro Santiago de Chile
Milk deficit in mill t. Milk equivalents
Sao Paulo Buenos Aires
NZ + annual change Surplus in mill tons Deficit in mill tons
Milk surplus46,00 in mill. t 15,00 Milk equivalents
- annual change 2.000,00 10 mill 650,00 3 mill
tons/year
tons/year
100,00 0.5 mill
tons/year
2,00
Calculation of surplus or deficit per country or region: Milk production minus milk demand. Regional demand: Regional population and country average per capita milk consumption. Additional assumption for India: Not delivered milk is consumed in the region where it is produced. Remarks: Moscow region and city shown as one, Buenos Aires region and city shown as one, Santiago de Chile = Metropolitana region. Regional abbreviations: USA: CA = California, ID = Idaho, WI = Wisconsin, FL = Florida. China: IM = Inner Mongolia, HL = Heilongjiang Sheng.
© IFCN 2013
Source: IFCN Dairy Report 2011, p. 64
Outline 1. Milk prices 2. Milk processing + demand
3. Milk production 4. Farming systems + costs
Annex 1: What is IFCN Annex 2: Dairy Pictures
© IFCN 2013
Globally milk processing is fragmented IFCN Top 20 Milk processor list 2012/2011
Rank
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Company name
Fonterra Co-operative Group Dairy Farmers of America Groupe Lactalis (Parmalat) Nestlé
Dean Foods Arla Foods/MUH/Milk Link FrieslandCampina
Danone Kraft Foods DMK Saputo Inc. Glanbia Group Land O' Lakes Inc. California Dairies Inc.
Unternehmensgruppe Theo Müller Groupe Sodiaal Mengniu Dairy Company Ltd. GCMMF (Amul)
Yili Group Bongrain SA Sum of Top 20
© IFCN 2013
Country
New Zealand USA France Switzerland USA Denmark/Sweden The Netherlands France USA Germany Canada/USA Ireland USA USA Germany France China India China France
Dairy processing plants Market share in Milk intake, main location % of world milk in mill. t production
international USA international international USA DK/SE/DE/UK NL/DE international international Germany Canada/USA/Argentina international USA USA international France China India China international
3.0% 2.4% 2.1% 2.1% 1.7% 1.7% 1.4% 1.1% 1.1% 1.0% 0.9% 0.8% 0.8% 0.6% 0.6% 0.6% 0.6% 0.6% 0.6% 0.5% 24%
21.6 17.1
Dairy turnover, US-$ bill.
16.4 13.0
15.0
16.9
14.9*
12.0 12.0 10.1
19.1 13.1 12.0 13.4
8.2
15.6
7.8 6.9 6.3 6.0
7.5 6.4 7.0 3.9
5.9
4.3
4.6
3.6
3.0 6.5 5.7 5.8 2.5 5.8 5.5
172.8
183.4
4.4 4.1 4.1**
4.0 4.0**
Source: IFCN analysis and estimates. Data represents in most cases the year 2011. *2010, ** estimated. Explanation: Milk intake represents milk volume collected, commodity purchase (in milk equivalent) for main company and its subsidiaries. Milk intake figures in mill tons. In some cases recalculated from litre (1litre = 1.033 kg). Dairy Source: IFCNthe 2012 turnover represents turnover w hich belongs only to processed milk and not to other activities. Turnover figures in US-$ bill, in some cases converted to US-$ by using
We need per year 20 mill t more milk World milk demand growth 1996 – 2011
+ 12 mill t via more per capita consumption
+ 8 mill t via more people on earth
© IFCN 2013
Source: IFCN Database 2012
Comparable IFCN milk demand figures
Per capita dairy consumption in kg milk equivalents (ME) in 2011
187
77
130 126
15 45
60
12 >300
58
Source of data: National statistics, FAO, IMF. Calculation: Dairy consumption = milk production of all milk animals plus import minus export volumes plus or minus stock changes. Per capita consumption = dairy consumption in the country divided by population. Specification: Milk production data in ECM (Energy corrected milk) standardised to 4% fat and 3.3 % protein. ME (milk equivalent) based on fat and protein only. © IFCN 2013
Source: IFCN Dairy Report 2012
Outline 1. Milk prices 2. Milk processing + demand
3. Milk production 4. Farming systems + costs
Annex 1: What is IFCN Annex 2: Dairy Pictures
© IFCN 2013
Only 62% of milk reaches processors Status of milk production 2011
© IFCN 2013
Source: IFCN Dairy Report 2012
So far
Milk production grew where demand grew Change in milk production 2006-2011
© IFCN 2013
Source: IFCN Dairy Report 2012
IFCN can define key dairy regions Milk density in t milk / km2 land
1st IFCN Milk density map – Dairy Report 2005
Milk density (milk prod in tons / km 2 total land)
> 150
Main milk producing regions
50 - 150 25 - 50
Source: Based on national statistics provided by IFCN scientists © IFCN 2013
IFCN can define key dairy regions Milk density in t milk / km2 land
© IFCN 2013
Source: IFCN Dairy Report 2011
Outline 1. World milk price 2. Milk demand + processing
3. Milk production 4. Farming systems + costs
Annex 1: What is IFCN Annex 2: Dairy Pictures
© IFCN 2013
World ø dairy farm has 2.8 cows Average dairy farm size 2010
145 million dairy farms 0.7 to 1 billion people live on dairy farms © IFCN 2013
Source: IFCN Dairy Report 2011
USA
In the dairy chain, milk production represents the major share of: a) the costs, b) people employed, c) resources used / emissions created d) the political challenges
© IFCN 2013
China
70-80% rule for a dairy product
India
Brazil
IFCN can measure costs to produce milk Cost of milk production range from 0.1 – 1 US-$ / kg
© IFCN 2013
Source: IFCN Dairy Report 2012
“Grass” is the main feed for dairy cows Ration composition on ø sized farms in 59 dairy regions
© IFCN 2013
Source: IFCN Database 2012
Sum up IFCN view on milk production (1) IFCN has developed global standards for dairy analysis like, ECM milk production, milk demand in ME, cost to produce milk, etc. 1. World milk prices have reached in April 2013 new highs and will be the key driver for milk prices of dairy farmers world wide 2. Milk demand grows by 20 mill t per year. This equals the annual milk production of New Zealand. 3. Milk production grew in the past where demand grew The world ø dairy farm has 2.8 cows. 62% of the milk reaches processors. 4. Farming systems and dairy economics Milk production costs range from 0.1 – 1 US-$ per kg milk Grass is the main feed source for dairy cows © IFCN 2013
Sum up IFCN view on milk production (2) What to do once the dairy economics do not work well Option 1: Ask policy makers for help – (old European way ) Option 2: Wait + pray for better milk / feed prices
Option 3: lower costs - Improve the existing system (efficiency) Option 4: lower costs - Find ways to get better input prices (price) Option 5: lower costs - Move to a better fitting dairy system (system)
Option 6: Close down the farm or relocate (farms + dairy plants) Recommendation for each dairy region 1. Benchmark your farming system internationally to navigate! 2. You can improve what you can measure step 3 – 5. Go for it! © IFCN 2013
Questions to focus on during IFCN Dairy Conference
1. How will the dairy future look like? Milk prices - What milk levels / swings to expect? Milk production – where, how, how fast are the changes,.. ? 2023 – How will the dairy sector look like ?
now Past
© IFCN 2013
Future
IFCN is a way to understand a complex & fast changing dairy world
© IFCN 2013
2. How shall IFCN look like in the future? So we focused on knowledge creation + relationships? I-Pod I-Phone 2001 2007
I-Pad 2010 now
IFCN 1995
IFCN 2000
IFCN 2005
IFCN 2010
I-FCN
I-FCN = The current IFCN + IT opportunities using Imagination of “products” as key driver Independent f. its founders No. I: global dairy knowledge + data provider © IFCN 2013
Questions to be answered during IFCN Dairy Conference What have been the latest developments in the dairy sector? How will global milk production look like in the future?
What kind of challenges for milk production are thinkable?
© IFCN 2013
Outline 1. World milk price 2. Milk demand + processing
3. Milk production 4. Farming systems + costs
Annex 1: What is IFCN Annex 2: Dairy Pictures
© IFCN 2013
IFCN is a way to understand a complex & fast changing dairy world
© IFCN 2013
IFCN = International Farm Comparison Network The IFCN is a global dairy network of researchers, companies and other stakeholders who are active in the dairy chain. The IFCN has a Dairy Research Center with 15 dairy researchers coordinating the network process + running dairy research activities. The IFCN is independent from third parties and committed to truth, science and reliability of results.
Researchers
© IFCN 2013
IFCN Dairy Research Center
Companies
USA
Argentina
IFCN mission We create a better understanding of milk production world wide
© IFCN 2013 China
India
Ethiopia
Brazil
USA
In the dairy chain, milk production represents the major share of: a) the costs, b) people employed, c) resources used / emissions created d) the political challenges
© IFCN 2013
China
70-80% rule for a dairy product
India
Brazil
Status of the IFCN Network in 2013 91 countries analysed in Dairy Report 2012
9 Institutional partners
99 Agribusiness partners
Researchers partners from > 80 countries
© IFCN 2013
Pictures World Dairy Map 2012
Bangladesh
Norway
Colombia
Chile © IFCN 2013
Pictures World Dairy Map 2012
Kenya
Indonesia
© IFCN 2013
Pictures World Dairy Map 2013
Colombia
© IFCN 2013
India
Pictures World Dairy Map 2013
USA
Mexico
Bangladesh © IFCN 2013
Pictures World Dairy Map 2012/13
Team in IFCN Dairy Research Center 2012 © IFCN 2013
Team in IFCN Dairy Research Center 2013
