Key findings of the 12 th IFCN Dairy Conference 2011 in Kiel Participants: Dairy economists from 45 countries Content 1. Key findings 2. Status of IFCN 2011 Annex IFCN Dairy Research Center Schauenburger Straße 116 24118 Kiel, Germany Phone: +49 (0) 431 5606 250 email: info@ifcndairy.org website: www.ifcndairy.org 1
Key findings of the IFCN Conference This paper is summarising the key findings of the 12 th IFCN Dairy Conference, held in Kiel, Germany the 1 st to 8 th June 2011. So far 91 countries participate in the annual IFCN work. These countries represent 97% of world milk production. Dairy economists from 45 countries have participated in IFCN Dairy Conference, representing 84% of world milk production. 1. Milk production growth 2011/12 can reach new record highs of + 20 mill t/year - In 2010 milk production grew 11.8 mill. t (cow/buffalo milk, standardised 4% fat, 3.3% protein) - In the crisis year 2009 milk production grew only 4.1 mill. t. - In 2005 to 2010 world milk production grew in average by 11.7 mill. t / year. - In 2011 and also 2012 good milk prices can lead to a growth of up to 20 mill. t milk per year. 2. IFCN 2011 Ranking of the top 21 milk processors - The top 21 dairy companies process 24% of world milk production. - No. 1 milk processor in the world is Fonterra which processes 3% of the world milk. - No. 2 to 5 are: Dairy Farmers of America, Nestlé, Dean Foods, Royal Friesland Campina. - Compared to the IFCN ranking from 2009 there was no mayor change in the ranks 1 to 10. - Via mergers Nordmilch & Humana and Sodial & Entremont alliance have improved their rank. - In Asia the companies Mengniu, Yili and Amul gained position via strong growth in milk intake. - Milk processors in the USA showed stable milk intake and lost positions in this ranking. 3. IFCN strategy to be The leading, global knowledge organization in milk production The research partners in the network have agreed to implement a new strategy to reach the vision to be the leading, global knowledge organization in milk production. This new strategy provides a better base to support local dairy stakeholders creating dairy development strategies. Moreover, it enables the IFCN to better serve the needs of the global dairy industry as a whole. The very unique intranet platform, formally introduced the 8 th of June, allows a much faster and deeper exchange of information in the network (for details see Annexes 1 & 2). 4. The new IFCN Dairy Report 2011 will be released in October The IFCN Dairy Report 2011 will be available in October 2011 and will cover the topics described above in much more depth. Results of the 2011 IFCN work will be also presented at the IDF world dairy summit in Italy. For details on the IFCN and its researcher and company partnerships please visit our website or contact info@ifcndairy.org. 5. The IFCN World Dairy Map 2011 was released (details see Annex 3) 2
IFCN Top-21 milk processors list 2011 (measured by milk intake) Rank Company name Country Dairy processing plants main location Milk intake in mill. t Market share in % of world milk production 1 Fonterra New Zealand international 20.5 3.0% 2 Dairy Farmers of America USA USA 17.1 2.5% 3 Nestle Switzerland international 14.9 2.2% 4 Dean Foods USA USA 11.8 1.7% 5 Royal FrieslandCampina The Netherlands The Netherlands 10.3 1.5% 6 Lactalis France international 10.2 1.5% 7 Arla Foods Denmark/Sweden Denmark/Sweden 8.7 1.3% 8 Danone France international 8.0 1.2% 9 California Dairies Inc. USA USA 7.7 1.1% 10 Kraft Foods USA international 7.5 1.1% 11 Nordmilch & Humana (DMK) Germany Germany 6.7 1.0% 12 Saputo Canada/USA Canada/USA 6.2 0.9% 13 Land O' Lakes Inc. USA USA 5.8 0.9% 14 Sodiaal & Entremont alliance France France 4.2 0.6% 15 Mengniu group China China 3.8 0.6% 16 Parmalat Italy international 3.7 0.6% 17 Yili group China China 3.7 0.5% 18 Amul India India 3.4 0.5% 19 Northwest Dairy Association USA USA 3.3 0.5% 20 Schreiber Foods Inc. USA USA 3.3 0.5% 21 Murray Goulburn Australia Australia 3.2 0.5% Sum top 21 163.9 24% Source: IFCN analysis is based on the IFCN Dairy Report 2010 and additional analyses and estimates. Data represents in most cases the year 2009 or 2010. Explanation: Milk intake represents milk volume collected, commodity purchase (in milk equivalents) and subsidiaries in other countries. Milk intake figures in mill. tons. In some cases recalculated from liter (1liter = 1.033 kg). Comments: Amul (India): milk with high fat content. Nordmilch and Humana merged in 2010 and created new company Deutsches Milchkontor (DMK). Sodiaal and Entremont alliance merged in 2011. Fonterra and Nestle incl. 50% of milk intake of Dairy Partners America (DPA) each. In some cases: double-counting of milk intake possible (companies purchase milk / dairy ingredients from each other). IFCN Top-21 milk processors list 2009 (measured by milk intake) Rank Company name Country Dairy processing plants Milk intake Market share main location Mill t ME % of world production 1 Fonterra New Zealand International 18,6 2,7% 2 Dairy Farmers of America USA USA 16,2 2,3% 3 Nestle Switzerland International 12,0 1,7% 4 Dean Foods - US USA USA 11,8 1,7% 5 Campina & Friesland The Netherlands The Netherlands 11,3 1,6% 6 Lactalis France International 8,9 1,3% 7 Arla Foods Sweden Denmark/Sweden 8,3 1,2% 8 California Dairies Inc. USA USA 7,7 1,1% 9 Danone France International 7,3 1,0% 10 Kraft USA International 6,7 1,0% 11 Land O' Lakes USA USA 5,5 0,8% 12 Saputo Canada Canada/USA 4,3 0,6% 13 Nordmilch Germany Germany 4,2 0,6% 14 Schreiber Foods USA USA 3,7 0,5% 15 Bongrain France France 3,6 0,5% 16 Parmalat Italy International 3,5 0,5% 17 Murray Goulburn Australia Australia 3,2 0,5% 18 Northwest Dairy Association USA USA 3,1 0,4% 19 Mengniu group China China 2,9 0,4% 20 Glanbia Ireland Ireland/USA 2,8 0,4% 21 Amul India India 2,7 0,4% Sum top 21 148 21% Source: IFCN analysis is based on IFCN Dairy Report 2008 + additional analysis and estimates. Data represent mainly the year 2007. Explanation: Milk intake represents milk volume collected + commodity purchase in home countries and subsidiaries in other countries. ME= Milk equivalent; Method: Fat/protein method, Data: Basis is mainly 2007 in some cases 2006 3
Annex 1.: Key elements of the new IFCN strategy 1. IFCN Vision 2. IFCN Mission We are the leading, global knowledge organization in milk production We create a better understanding of milk production worldwide. 3. IFCN identity, competence, values and concept The identity of the International Farm Comparison Network (IFCN) The IFCN is a global network of dairy researchers related to companies and other stakeholders of the dairy chain. The IFCN has a Dairy Research Center (DRC) with approx. 10 researchers coordinating the network process and running dairy research activities. Focus on milk production In the dairy chain the major share of a) the costs, b) resources used, c) emissions created and d) the political challenges come from producing the milk itself. That s why the IFCN focuses on milk production and related topics like milk prices, dairy farm economics, etc. Core competence The IFCN core competence is in the network of dairy people who have built trust the last 10 years to openly share and discuss dairy issues. This and the annual working process make the IFCN an ongoing knowledge creation system. IFCN Dairy Conference 2010 - for internal use only Core values The IFCN is independent from third parties and is committed to truth, science and reliability of results. The IFCN and all its partners commit themselves not to get involved in any discussions or activities that may infringe any applicable competition law. The concept of three circles The IFCN network concept is based on three circles and the related win-win partnerships. Picture 1: The 3 circles of IFCN Circle 3 get public goods of IFCN - free of charge Circle 2 get services from IFCN + provide funding Circle 1 Researchers creating the IFCN knowledge (the network goods) Circle 1: The participating dairy researchers and the people in the DRC create the IFCN knowledge by sharing and managing information. Circle 2: Dairy related companies and organisations get services from the IFCN. In return they finance the IFCN activities of the center (DRC) and in the countries. Circle 3: Part of the IFCN knowledge defined by the DRC can be made available as a public good for the global dairy industry. 4
Annex 2.: Description of the IFCN and its status 2011 Status of IFCN Network in 2011 The IFCN, founded in 1997, is a global network of dairy researchers from over 85 countries. Moreover 82 dairy related companies are a partner of the IFCN. In 2011 the IFCN has made significant progress to develop research partnerships in 13 countries: Morocco, Algeria, Tunisia, Sudan, Ethiopia, Uruguay, Colombia, Belarus, Macedonia, Armenia, Bulgaria, Saudi Arabia and Iran. We started as well the process to have from larger dairy countries (USA, Brazil, China, India) more than one person attending the IFCN Dairy Conference. Participating in IFCN in 2011 Status of the IFCN Dairy Research Center The Dairy Research Center (DRC), connected with the University Kiel, is coordinating the network activities and the various partnerships for researchers, institutions and companies. Together with our research partners the center develops standard methods and condenses dairy data from over 100 countries. This ongoing process provides a cross country comparability and leads to global dairy insights. To fulfill its tasks the DRC has currently 18 people (10 senior researchers + PhD/MSc students and support people). In 2011 Martin Hagemann and Mohammad Uddin have finished their PhD thesis. Program of the 12th IFCN Dairy Conference 82 dairy researchers from 45 countries attended at this year s conference.. 5
Annex 3.: IFCN World Dairy Map 2011 6