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Rabobank 2021 Global Dairy Top 20

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Rabobank, Media Release, 25 August 2021

New leader, sustainability, dairy alternatives, and changing demographics shaping the future – Rabobank 2021 Global Dairy Top 20

Rabobank’s annual Global Dairy Top 20 report shows the combined turnover of the top 20 industry leaders fell by just 0.1% in US dollar terms, following the prior year’s 1.8% gain. In euro terms, the combined turnover decreased by 1.9%. Merger and acquisition activity slowed in 2020, with approximately 80 announced deals vs. the prior year’s 105. Activity picked up in 2021, with over 50 deals announced through mid year.

In 2021, privately-held Lactalis unseated long-time industry titan Nestlé as the world’s largest dairy company, according to Mary Ledman, Global Dairy Strategist for Rabobank. “Lactalis’s attention to organic growth, as well as its dedicated global M&A strategy, propelled the company from ninth place in 2000 to a dominating lead position in 2021,” says Ledman.

In 2020, dairy companies faced significant challenges due to the Covid-19 pandemic, but overall, the sector fared better than expected, demonstrating its resilience. The pandemic also heightened consumers’ awareness of environmental challenges.

Sustainability as a growth driver

“Consumer sentiments are being heard, and many companies included in the Global Dairy Top 20 have made sustainability commitments for 2030 and carbon-neutrality commitments for 2050,” according to Richard Scheper, Dairy Analyst for Rabobank. According to NYU Stern Center for Sustainable Business, sustainability-marketed US milk sales grew more than 20% from 2013 to 2018, compared to negative growth for the category as a whole. Sustainability-marketed natural cheese and yogurt sales grew over 30% and 20%, respectively, compared to near 10% growth for those categories broadly over the five-year period.

Dairy alternatives keep growing and blurring the definition of dairy 

The sales growth of liquid milk and yogurt alternatives – especially oat- and almond-based alternatives – have not gone unnoticed. Most significantly, Danone’s turnover in dairy alternatives, following its acquisition of WhiteWave Foods in 2017, was recorded at EUR 2.2bn (USD 2.5bn) in 2020, a gain of 15% compared to the previous year. Adding these sales would lift Danone to third position. Dairy alternative du jour Oatly surged in market capitalization, to more than USD 10bn, after its IPO debut in May 2021. “The designation of dairy is also becoming more blurred as hybrid products, containing both dairy and plant-based ingredients, enter the marketplace,” says Scheper. 

Download the full report here.

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