91¶¶Òù

IBISWorld forecasts milk consumption to fall by 1.0% in 2027, to reach 88.2 litres per capita. Milk consumption is influenced by a range of factors, including changes in domestic milk prices, population demographics and consumer preferences. Elevated milk prices, owing to strong export demand and escalating fuel and fertiliser costs, is anticipated to induce some consumer to opt for plant-based alternatives, leading to a drop in milk consumption in the current year. Over the current year, Domestic milk prices have climbed over the past five years, curbing domestic milk consumption, with many consumers now opting for plant-based alternatives, like oat and soy milk, which, although sold at premium, have experienced relatively modest price growth in recent years. Domestic milk prices are largely determined by the opportunity cost of selling to the global dairy market, as approximately 95% of milk produced in New Zealand is exported, according to the Dairy Companies Association of New Zealand. This opportunity cost has grown in recent years, owing to strong demand from a growing middle-class across South-East Asia, an emerging recovery in Chinese dairy imports and a weak New Zealand dollar, placing upwards pressure on domestic milk prices.Consumer attitudes towards dairy products, which are partly driven by health consciousness and public concern over environmental issues, have weighed on milk consumption over the past five years. The resultant growing popularity of vegan and vegetarian diets has seen an increase in consumption of non-dairy milk alternatives, such as soy milk, almond milk, oat milk and coconut milk. Consumers, especially young people, are no longer as habituated to milk consumption as they once were and are increasingly preferring non-dairy milk alternatives. The launch of world-leading oat milk brand, Oatly, and re-opening of local brand Otis' New Zealand manufacturing plant in 2024 underscores the strength of growing demand of plant-based milk.Demographic changes can also influence milk consumption. An increase in the proportion of the population aged under 15 or over 70 can boost per capita milk consumption, as these age groups often consume milk due to the perceived health benefits. The share of the population aged 70 and above is far outpacing that of the total population, propping up domestic milk consumption. However, the growing popularity of plant-based alternatives, spurred by rising health and environment consciousness, and elevated milk prices have offset these demographic changes. Overall, 91¶¶Òù expects per capita milk consumption to fall at a compound annual 0.8% over the five years through 2027.