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However, exports were completely different. While the entire cheese industry had to accept a decline of 6.7% in terms of volume, raclette even increased slightly by 0.2%. Around 3,264 tons of raclette were exported, most of them to Germany.

By October 2022, raclette exports had also declined. But in the last quarter of 2022, the trend turned and exports increased.

“We benefited from the fact that in Germany, too, the wallet is a little looser during the holidays and consumers are happy to spend a little more for good food,” says Jürg Kriech, managing director of the Raclette Suisse organization.

The current year got off to an equally positive start, with exports up to April above the previous year’s level.

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Demand for premium milk in China is growing. China’s flourishing coffee culture in Shanghai, Hong Kong and Beijing is the main driver for this demand. And with a naturally higher fat and protein content, Jersey milk makes the perfect cappuccino or latte, frothing up to foam better than any other milk. Jersey milk also has a low ecological footprint, something that’s becoming more and more important to customers in China. Jersey milk naturally contains more fat, protein, vitamins B, D & E, calcium and omega-3 than regular milk. No cream is extracted during production, so the milk contains on average 6.2% fat and 4.2% protein compared to 3.6% fat and 3.5% protein found in regular milk.

Holland Jersey is working with Gold Tulip, an international trade company in Shanghai with a large portfolio of international brands. Gold Tulip introduced Holland Jersey to local chefs and baristas to explain the characteristics of Jersey milk, with the goal to eventually inspire home baristas too. Look out for a TikTok campaign to support this launch.

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Arla has also announced it will be looking to export more of its UK products overseas. Again, the British flag has a good reputation for export markets and let’s face it, if you can get a decent return for your products versus the domestic market, it makes sense to head west where the customers are.

A report by Kite Consulting also looks at this burgeoning export market, and suggests that it may be preferable to some domestic markets for some processors. The report, entitled Beyond Reset, builds on the analysis Kite conducted in October 2021, in its report Opportunities ahead, which outlined long-term global demand growth for dairy products. (www.kiteconsulting.com).

The report notes that this access to global markets is one that wasn’t an option in the past, and introduces a new dynamic in the sector, particularly for the liquid side of the business. It also suggests that using liquid milk as a loss leader for British retailers is not likely to remain viable.

John Allen, managing partner of Kite Consulting, adds: “If retailers want to secure long-term supply from partners that are committed to fulfilling their decarbonisation objectives, they need to provide a competitive market return. There has got to be a reset, prioritising fresh liquid milk and valuing it accordingly. UK farming become a potentially better place to be for the long term. Being out of the EU makes it a better place to export from, whether we wanted to leave or not. It created a situation and dynamic for the export business.”

• Suzanne Christiansen, editor, Dairy Industries International.
  Keep in touch via email: suzanne@bellpublishing.com
  Twitter: @dairyindustries or LinkedIn: Dairy Industries International magazine.

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With an overall increase of 3.9% compared to the previous year, 2021 was also a record year for production, reaching 4.09 million wheels of cheese, equivalent to around 163,000 tonnes. These figures follow the Consortium of Parmigiano Reggiano’s increasing focus on foreign markets which offer excellent development opportunities for a constantly growing, but planned, production. Overall, production has risen by 10.6% over the last four years, from 3.7 million wheels of cheese to 4.09 million wheels.

Parmigiano Reggiano also enjoyed a stable position in terms of market price, with an annual average of 10.34 €/kilo for 12-month Parmigiano Reggiano from a dairy producer, with price fluctuations between 10.25 €/kg and 10.40 €/kg. In comparison, the average price for the same product in 2020 was 8.57 €/kg and 10.76 €/kg before the onset of the pandemic in 2019.

Over the last year, Parmigiano Reggiano’s distribution of consumption showed an increasingly international tendency, with the cheese being enjoyed globally.

Italy, which accounts for 55% of the market, recorded a 4.5% increase in consumption compared to pre-pandemic levels, consuming 89,101 tons in 2021 compared to 85,258 in 2019. The figure is slightly down (-1.3%) from 2020, which observed a boom in domestic consumption of Parmigiano Reggiano sparked by the Covid-19 pandemic and ensuing lockdown.

Large retail remains the main distribution channel (51%), followed by direct sales from dairies (which recorded a sharp increase), and by the general food industry (14%), including products featuring Parmigiano Reggiano amongst the ingredients. The HORECA industry remained in last position, but accounted for 7% compared to 2% in 2020, therefore presenting an enormous potential for growth and development. The remaining 8% is distributed among other sales channels.

Parmigiano Reggiano’s export share observed a 2.9% volume growth to 45%, with the United States as the first market, accounting for 21% of total exports. France (19%) and Germany (17%) followed in second and third place, respectively, with the United Kingdom (11%) and Canada (5%) in fourth and fifth.

In these main markets, the best sales performances were recorded in the United States (up 10.4%), France (up 4.5%), and Canada (up 5.5%). Most other European markets also recorded growth, with Switzerland (up 14.7%) and Sweden (up 13.2%) of particular note. The same cannot be said for Germany (down 1.9%) and the United Kingdom (down 15.6%), which lost ground despite significant growth in 2020, the latter being particularly affected by ongoing issues caused by the UK’s withdrawal from the European Union.

Nicola Bertinelli, president of the Parmigiano Reggiano Consortium, commented, “Despite the pandemic, our sector has managed to increase consumption and achieve price stability at production over the last year. As we emerge from this phase following the WHO’s announcement that the improved situation in Europe could be heralding the end of the pandemic, we will need to address Covid-19’s consequences on the market. Among these is the risk of excessive supply due to an increase in production driven by prices and demand.

The Consortium’s new marketing and production plans, agreed upon in December 2021, will be integral tools in addressing these potential challenges, setting Parmigiano Reggiano on track for a long-term strong growth trajectory.”

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Overall, revenues for the Swiss cheese industry (dairy farmers, cheese makers, refiners, trade) in 2021 was CHF 756.7 million (€727.5m), which corresponds to an increase of +9.1% compared to the same period in 2020. This increase is due on the one hand to the uptick in export volumes, but on the other hand to price increases. At CHF9.18/kg (wholesale price), the average export price was higher than 2020 (CHF9/kg).

Likewise, more Swiss cheese was produced in 2021 and demand continued to rise sharply in 2021.

Around 47% of Swiss milk is processed into over 700 different Swiss cheese specialities. Almost 40% of this is exported to over 70 countries worldwide.

The main market for Swiss cheese is Europe, with 82% of the exported volume or 67,895 tons, an increase of 7.9%. Of this, Germany imports 34,804 tons of Swiss cheese. This corresponds to a good half of the total volume that is exported to Europe. This is followed by Italy with 11,548 tons and France with 6,731 tons of Swiss cheese.

Exports to outside of Europe increased again in 2021, when a total of 14,575 tons of Swiss cheese or 2.6% were exported outside of Europe. In particular, the US market grew by 6.5% to a total of 9,716 tons.

Swiss cheese benefits from consumer trends of naturalness, craftsmanship and tradition. The Swiss specialities were also able to benefit from the increasing vegetarian consumption trend in 2021. With its values and high-quality Swiss milk, Swiss cheese meets the expectations of consumers at home and abroad particularly well.

Although the import statistics also show an increase of 5.7% in 2021, the import growth has fallen sharply compared to 2020. A total of 75,774 tons of cheese were imported in 2021, which corresponds to a quantitative increase of +4,076 tons. In comparison, this increase in 2020 was around 7,529 tons.

Imports come from Europe, in particular from Italy (26,744t, +4.5%), Germany (20,535t, +4.9%) and France (13,580t, +0.7%).

In terms of value, CHF 487.7 million (+7.8%) was spent on imported cheese in 2021. The average import price in 2021 was CHF 6.44 per kg (wholesale price). Switzerland therefore imports much cheaper cheese than it exports.

The majority of imports come from the ‘fresh cheese and quark’ category with 31,368 tons or 41.4% of total imports. This category has also increased the most with an increase of +10.9% and a wholesale price of 4.68 CHF/kg.

In this context, it should be noted that the range of inexpensive imported products has changed significantly since 2020. For example, price-sensitive consumers can now also find the cheeses they previously bought abroad, on the shelves of Swiss retailers.

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It has also grown in markets such as China and the Far East, Europe, the Caribbean, and Australia and in emerging markets including the Middle East and North Africa and Southeast Asia.

The results demonstrate that, during the year Somerdale continued to perform strongly at a financial, commercial and operational level despite the unprecedented challenges of Covid-19, the UK’s leaving of the European Union and the impact, for nearly all of the year, of retaliatory tariffs imposed on British cheese entering the US market, the company says.

Trading conditions were good for the majority of the year with the Covid-19 pandemic only having a limited negative impact. Indeed, in most markets, the business benefitted from a surge in demand as lockdown restrictions gave rise to a renaissance in home cooking and entertaining at home, which in turn resulted in consumers purchasing more of Somerdale’s products through its retail distribution channels.

In the current financial year, the business is continuing to perform well despite a significant increase in freight and packaging costs, restricted shipping container availability and labour shortages.

In the last quarter of the financial year, Somerdale acquired the blended cheese business of Abergavenny Fine Foods (AFF). This included the transfer to Somerdale of AFF’s blended cheese processing assets, brands and associated trademarks. In doing so, this has reinforced Somerdale’s position as a supplier of blended cheese to over 30 countries across the globe and is enabling it to grow and develop a portfolio of blended cheeses developed specifically for the international marketplace.

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Sales to non-EU nations accounted for 55% of all UK food and drink exports, with exports to the EU having fallen by £2bn compared with Q1 2019. Exports to nearly all EU Member States fell significantly. In Q1 2021, sales to Ireland were down by more than two thirds, while sales to Germany, Spain and Italy declined by more than half since Q1 2020.

All of the UK’s top 10 products exported to the EU fell significantly in value from 2019 to 2021, with whisky dropping 32.3%, chocolate 36.9% and lamb and mutton 14.3%. Dairy products have been most severely impacted. Compared to 2020, exports of milk and cream to the EU have fallen by more than 90%, and exports of cheese by two thirds in the same time period.

There has also been a return to strong growth in exports to East Asia, where there is high demand for quality UK food and drink. In Q1 2021, exports to China (+28.2%), Hong Kong (+3.7%), Japan (+6.2%) and South Korea (+18.5%) were all above the levels seen in Q1 2020, when the Covid-19 pandemic triggered the early closure of hospitality sectors. The UK’s top three non-EU markets, US (11%), China (5%) and Singapore (3%), now account for 19% of the UK’s total exports, a figure of £713m.

UK imports from the EU were also down 10%, driven by a number of factors including the continued closure of the UK’s hospitality sector, stockpiling in late 2020, reduced demand for ingredients as a result of the decline in exports to the EU, and import substitution. This fall is set to increase when full checks are implemented at UK borders in 2022. Of the UK’s top 10 products imported from the EU from 2019 to 2021, vegetables dropped 13.9%, wine 20%, and fruit 15.7%. Products of animal original were also heavily impacted, with large falls in imports of EU pork, cheese, chicken and beef.

Dominic Goudie, head of international Trade at FDF, said: “The loss of £2bn of exports to the EU is a disaster for our industry, and is a very clear indication of the scale of losses that UK manufacturers face in the longer-term due to new trade barriers with the EU.

“We set out a plan to mitigate these impacts by boosting support for exporters, and this was backed by the Trade and Agriculture Commission. The Government must stop prevaricating and get behind these proposals to help exporters that have been shut out of trading with the EU.”

John Whitehead, Food & Drink Exporters Association (FDEA), said: “Whilst some of this large drop can be put down to end of year stockpiling, significant business has been lost as a direct result of the additional bureaucracy, customs delays and costs of trading with the EU. Experienced FDEA members are continuing to battle against inconsistent interpretations of regulations across the EU and having to weigh up whether the time and cost involved is sustainable. We fully support the FDF in pressing Government to boost support for exporters.”

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Dominic Goudie, head of international trade at FDF, regarding his views on these statistics: “While UK food and drink exports to the EU have improved from a 76% fall in January, they are still down nearly 41% in February 2021. Exports to our biggest market, Ireland, have also dropped more than two thirds. UK businesses continue to struggle with inconsistent and incorrect demands at EU borders, and small businesses have been hardest hit due to the collapse of groupage distribution into the EU.

“New EU import requirements for composite products entered into force this week, adding even greater complexity, cost and uncertainty for UK exporters. It is essential that the EU-UK Partnership Council and its Trade Specialised Committees are convened to urgently address problems with the implementation of the EU-UK Trade and Cooperation Agreement to ensure small businesses are not shut out of trade by this trade deal.”

Meanwhile, imports from the EU also fell, with cheese down by 20.9% to £92.7 million.

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Now, I have lived all my life on an island, and grew up enjoying a lot of the ocean’s output, from clams to lobsters and every fish in between. However, on this island, there are people whose main idea of seafood is fish and chips. Or have never had a lobster. Or don’t like fish. This makes me sad. But by golly, I’m going to do my part to help. We received five of these local lobsters, and we ate the pictured feast this weekend.

It seems like eating locally will be a trend for a while. Global exports in dairy products are forecast to fall by 4.1% in 2020, according to the UN Food and Agriculture Organisation (FAO). This would be the steepest contraction in around 30 years if realised, as import demand drops in multiple countries. For overall UK dairy export volumes, the vast majority of exports are destined for the EU (91% in 2019), the Agricultural and Horticultural Board (AHDB) notes.

Losses are more noticeable for specific markets, and for individual companies. For example, China and Algeria are big importers of milk powders, and are relatively important markets for UK exporters. In 2019, the UK exported around 8,000 tonnes of milk powders and concentrates to each of these countries, together accounting for 10% of annual volumes and 27% of the total value, according to the AHDB.

I suspect that once the export market comes back, it will be changing, with Brexit adding different markets to the mix as well. I don’t think dairy will go back to the days where only 7% of the total production was traded internationally, but I do think the countries importing dairy products will see changes in what types of dairy their citizens ask for.

• Suzanne Christiansen, editor, Dairy Industries International.
  Keep in touch via email: suzanne@bellpublishing.com
  Twitter: @dairyindustries or LinkedIn: Dairy Industries International magazine.

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Eurostat data indicates that milk deliveries in May 2020 for France, Italy and the UK were down 2%, 8% and 1%, respectively compared to May 2019. In 2019 these three regions accounted for about one-third of the EU’s total milk deliveries. In Germany milk production in May was flat YOY, while in Ireland and the Czech Republic it was 3-4% higher.

Given these factors, for the balance of the year EU milk production is expected to slow during the summer but recover to some extent in the autumn. Consequently, the milk production forecast is revised up but only by 1% to 156.7 million tons, which represents a 1% increase over 2019 output.

The European Union cheese export forecast for 2020 is revised up by 3% to 925,000 tons, which represents an expansion of 5% over 2019. Year-to-date shipments this year have been about 9% ahead in comparison to the same period last year. However, shipments are expected to slow down during the second half of the year as the availability of industrial milk declines due to the seasonal decline in milk production.

Traditionally the US has been the largest market for EU cheese accounting for about 16 % of EU shipments in 2019. This year, shipments to the US import market through May are down about 11%. This may have been due to Covid-19 affecting the food service sector and the retaliatory tariffs of 25% imposed on imports of EU cheeses by the US starting in October 2019 over the WTO ruling in favour of the US over EU subsidies to Airbus. EU cheese shipments, particularly to the Ukraine, South Korea, and Japan markets have increased significantly.

To support the dairy market during the Covid-19 pandemic, in late April the European Union authorised the subsidisation of storage costs for up to 100,000 tons of cheese for between 60-180 days under the Private Storage Scheme. The cumulative volumes through end-of-June totalled 48,000 tons.
For further information visit apps.fas.usda.gov/psdonline/circulars/dairy.pdf

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The most important growth driver in the past financial year was the ingredients division with an increase of 24.7%, mainly driven by the sale of organic lactose and whey derivatives, especially to manufacturers of baby food (organic products and derivatives increased in sales by 21.4% to 23,800 tons (organic lactose even increased by 58%) and a flourishing international business. The division’s export quota is now 67.2%.

The whey powder business was dampened in the second half of the year by the slump in demand from China due to swine fever.
With an increase in sales of 3%, the fresh produce area developed satisfactorily overall. Due to the drop in prices, especially for butter, cream and low-fat curd cheese, sales in this division were 2.7% below the previous year.

The completion of the new 35,000 tons hard cheese production dairy in Jessen and other construction measures on site proved to be challenges. Among other things, the delayed commissioning of the hard cheese factory and the high-bay warehouse had caused considerable additional costs, which had a negative impact on the 2019 result.

Efficiency increases and financing at the expense of liquidity cushioned the additional costs in Jessen to such an extent that they did not have an impact on the balance sheet.

The target output of 100 tons/day in Jessen has been reliably achieved since April, so that the location now has an annual throughput of 500 million kg.

As a dairy with a strong share of sales and exports in out-of-home consumption, BMI’s business suffers from the coronavirus pandemic: for a time, a large part of sales of fresh products and cheese came to a complete standstill; prices plummeted and several plants hardly had any orders left. This situation could only be partially compensated for by the significantly increased demand in the food retail sector.

The two freshness and cheese divisions have been recovering rapidly since mid-May. Despite all the uncertainties, the BMI anticipates an increase in sales of around €700 million for the full year.

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According to the Emmentaler AOP variety organisation, the corona crisis in Italy increasingly led to more grocery shopping, while sales in gastronomy suffered. At Emmentaler AOP, the decrease in April was 9.5% compared to the same month last year.

The Gruyère AOP export cheese was down by 16.2% in April. However, due to the good sales from January to March, both types of cheese are still up over the previous year.

For Appenzeller, there was a 25% drop in April compared to the previous year and a drop of 2.6% over the first four months.

Tilsiter, Raclette, Vacherin fribourgeois AOP and Sbrinz AOP also lost quantities in April, as did the segment of “other semi-hard cheeses with over 45% fat in the dry matter” and “other semi-hard cheeses with full fat”, each with a drop 21.6% and a decrease of 31% .

Only the large hole cheese Switzerland Swiss was able to increase by 50.8% in April, and it was up by 6.8% over the first four months.

In processed cheese, export growth was 37.2% in April and 12.3% in the first four months.

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Fortunes have starkly changed, however, with well-above average rainfalls since early 2020 throughout most of the previously drought-affected dairy farming regions. Dairy farmers predominantly supplying milk for manufactured products had the advantage of record high prices and, in general, were able to maintain their herd size enabling milk production to rebound quickly in 2020.

This has boosted pasture production, as well as resulted in reduced fodder and grain prices. As a result, milk production in the first quarter of 2020 was nearly 5% above the same period in 2019. FAS/Canberra forecasts overall milk production in 2020 at 9.2 million metric tons, up from 8.83 million in 2019. Cheese production is expected to have the greatest production increase of any of the major manufactured dairy products. Although the Covid-19 outbreak is not currently having a major impact on milk or dairy product production in Australia, it is expected to influence consumption and exports.

Fluid milk exports have seen consistent year-on-year increases over the last decade, increasing by 226% over the last 10 years. However, this growth is expected to stagnate in 2020, with exports forecast at 255,000 metric tonnes, nearly the same as 2019. This is due to disruption in trade caused by Covid-19. The fluid milk export is via air freight on passenger planes. With the large reduction in passenger flights due to Covid-19 there would be an expectation that export volumes would decline. However the Australian government has announced a support package to supplement the cost of air freight of perishable goods which was primarily targeted to the seafood industry but the dairy industry fluid milk and yoghurt products are also eligible and will support this trade. The majority of the growth of fluid milk exports is due to the growth in demand from China which now accounts for over 40%, with Singapore, Malaysia and Hong Kong the other key markets.

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The rise during January to May was primarily driven by limited availability of exports from Oceania in the face of strong global import demand. Dry weather conditions in Oceania, especially in Australia, led to poor pasture quality and water scarcity. Unusually high temperatures during the summer months in Europe also reduced the pasture quality and the availability of animal feed, moderating milk production expansion.

Across the key global regions, Asia registered the largest expansion, followed by Europe, North America, South America, Africa, Central America and the Caribbean, but declined Oceania.

In dairy products, the annual average value for SMP registered the highest year-on-year increase (32.7%), followed by those of cheese (7.8%) and WMP (3.8%), partially offset by a decline in butter prices (-15.7%). SMP prices increased, although its average value remained low compared to other dairy products. Firmer prices in 2019 were mostly driven by strong import demand ,while supplies were tight, especially from the European Union, where slow growth in milk deliveries forced producers to limit spot supplies in order to fulfil long-term export commitments. Oceania’s exports rose but was not adequate to contain price increases.

Cheese prices too strengthened, especially in the first half of the year, reflecting seasonally limited export availabilities from Oceania, as well as the European Union, with strong import demand from Asia. Cheese prices fell from June onwards as global export availabilities improved.

WMP prices also increased in the first months in 2019, followed by a period of weakening, mostly on recovery in export availabilities in Oceania; in tandem with the region’s seasonal production cycle. Limited export supplies from Europe during that time also lent support to prices. Despite high optimism for a significant rise in WMP exports with weather conditions in New Zealand becoming favourable for milk production, milk production started falling faster than had been anticipated, resulting in higher prices towards the end of the year.

By contrast to other dairy products, global butter prices fell significantly in 2019 (by 15.7%) on mounting supplies in Europe, Asia, Oceania and South America, notwithstanding some declines in North America. Contributing to the downward pressure on butter prices, import demand also stayed weak in 2019, especially from Asia and some countries in South America and Africa.

In Asia, milk output in 2019 increased by 10 million tonnes, or by 2.9% from 2018, to nearly 360 million tonnes, with over 90% of coming from India and Pakistan. India’s milk production continued to increase driven by rising demand, induced by high demand for processed food stemming from fast growing urbanisation. Production growth is facilitated by rising milk collection and processing, especially by dairy co-operatives, along with rising output of relatively more organized sector that adopts modern output expansion methods such as artificial insemination. Pakistan is the fourth largest milk producer in the world and, in 2019, its production is estimated to have expanded further by about 3%, mostly due to rising dairy cattle numbers, but also due to rising dairy cattle population. China’s milk output increased further in 2019, following a rebound already in 2018.

For further information, click here.

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The company’s global A Brands revenue were up 17.9%, driven by successful marketing and promotional investment. The company saw successful leverage if its A Brands into new markets – Mondelēz is now available in 17 countries and Extrême was rolled out across the UK and Spain. Its private label revenue was also up by 13.7%, supported in part by the hot summer weather in Q2 2018.

Investment in innovation and capability totalled €193m, up 83% on 2017 (€105.4m). The company optimised its performance by introducing the latest technologies available on the international market and establishing 12 new production lines.

Commenting on the annual results, Froneri CEO Ibrahim Najafi said: “Since our creation in 2016 we’ve worked hard to bring the Froneri family together into one winning team dedicated to producing consistently high-quality ice cream in all our markets. I’m immensely proud of our culture where we all understand what excellence looks like, and the significant progress we have made towards achieving our vision of building the world’s best ice cream company.”

The positive momentum has continued into 2019, with the launch of Nuii supported by international advertising campaigns, the further optimisation of the business and a number of significant strategic developments including the acquisition of New Zealand’s Tip Top.

“We have a very bright future ahead and continue at pace on our journey to become the world’s best ice cream company,” said Mr Najafi.

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Mr Amirahmadi outlined how although the government had recognised the importance of applying tariffs to dairy imports, those chosen for cheddar were inadequate to prevent price volatility or a loss of productivity and cause harm to the UK dairy industry. He also highlighted Dairy UK impact assessments on the effect of WTO tariff rates on the sector, which demonstrated a potential massive shock to raw milk prices.

Amirahmadi said: “One thing we can all agree on is that trade policy is key to the success of the sector going forward. We stand ready to work with our colleagues in government to ensure the voice of both dairy and agriculture is reflected in trade and tariff discussions.”

Mr Amirahmadi outlined the dairy industry’s proactivity on tackling environmental concerns, reflecting both the drive of the sector as well as consumers, to ensure the long-term sustainability of the industry. Over the course of the last decade the industry has achieved an 18% improvement in both energy and water efficiency and has recovered or recycled 93% of all factory produced waste.

Amirahmadi also highlighted future plans to work with industry group WRAP, to tackle consumer milk waste. He highlighted Dairy UK’s signatory status of the UK Plastics Pact, pledging effective action to deliver higher recycling rates, greater recycled content and eliminate single use plastics.

Mr Amirahmadi then went onto call on the industry to unite and fight the misinformation on dairy from detractors, highlighting that dairy foods continue to be found in 96% of fridges in the UK despite reports than consumers were turning away from the category. In closing, he said: “If we don’t inspire our consumers to continue to love our products, nobody will. We all have a role to play in telling the dairy story”.

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Müller said: “Dietary trends are changing – faster than expected. Issues such as sustainability in animal welfare and environmental protection, trends, regionality or convenience are buzz words these days when it comes to food. In order to speed up such developments in the future, Deutsche Milchkontor (DMK) is planning a long-term ‘Vision 2030’ for its six business segments. The restructuring of the company, which started in 2017, is to be continued.

“Time is a key factor in change. We know that the DMK has often strained the suffering of its farmers in the past. Nevertheless, we know that such a fundamental transformation as we are doing today does not happen overnight. In addition to the basic organisational measures of one of the largest German food manufacturers, the realignment is above all a massive change in the corporate culture. With both factors we have an ambitious plan, which we must also implement with due care in order to develop the full performance of the DMK. The first phase, which was also characterised by investment in the future, is almost complete. Now it’s about bringing in the effects in a targeted way.”

The changes to the company are in six areas, he said.

1. “Focusing on the consumer, thinking of his wishes and needs, that’s our top priority. Accordingly, we have formulated our new mission statement. In the future, we will deepen our understanding of the consumer even more and target individual generations. In every phase of life and to every need we already have an offer in our assortment for almost everyone. We will continue to expand this to our essential strength and work on it purposefully. Our new vision 2030 slogan is ‘The first choice, for a lifetime.’ This perfectly sums up for us what we plan to offer in the future with our product range.

2. “We are increasingly focusing our product range by withdrawing from selected business areas and defining clear roles for each business area. Where do we invest, where can we grow. Where do we have to design the business with clear measures in such a way that we can earn money even where there is no market growth per se? This leads to the motto, ‘Value creation before growth.’

3. “The DMK Group changes its positioning from being a pure volume player in the dairy industry to the supplier ‘for selected products of natural origin.’ In the process, milk will continue to be our number one raw material by far.

4. “In addition, we want to sharpen international activities, and here the organisational restructuring of recent years has not gone far enough. We see Europe as our home market and need to concentrate our expertise here in the right business units in the future. The brand in Europe takes place in the Brands business unit (BU), and the trademark on European soil is organised by the Private Label BU. With the new line-up, DMK can act as a competent partner here.

5. “Beyond the borders of Europe, the international BU now has the capacity to clearly structure the processing of non-European business. Outside Europe, we will set clear priorities. Regional bases in Russia, China or Nigeria with local teams are more effective for us than pure exports from Germany. A classic export makes sense in selected countries in which we also travel with appropriate volumes. We cannot buy any of this if we only count the number of export markets.

6. “Nutritional trends are changing – faster than expected. What about adjacent attractive beverage and food segments, which can be a future mainstay in addition to dairy products? What about plant-based alternatives? For a traditional company like the DMK, that must not be a no-go in the future. If you look at the global developments, you quickly realise two things. On the one hand, milk alone will no longer be enough to feed the growing population; on the other hand, consumers are already looking for alternatives for a variety of reasons. That would be negligent. We will take a targeted approach here – within the Brand BU, colleagues will look very closely at where and how we set up in this field in the coming months.”

In related news, Dr. Frank Claassen is the new chief financial officer at the DMK Group. He succeeds Volkmar Taucher, who will hand over his post as part of a planned succession 1 July 2019. He comes from Beiersdorf, where he most recently served as vice president Finance Europe.

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The inquiry, chaired by North Cornwall MP Scott Mann, took evidence from a range of witnesses, both from industry, farmers and executive bodies to understand what support the dairy sector needed to continue its trade in exports post-Brexit.

The report details five key areas in which the sector faces challenges in the wake of Brexit; tariffs on trade, maintaining current standards, animal health certification, increasing our exporting potential and building relationships with new markets.

Commenting on the publication of the report, Dairy APPG chair Scott Mann MP said: “I’m delighted to be launching our dairy exports inquiry report, looking to the future of dairy exports for the UK.

“The report outlines the challenges the UK dairy industry faces exporting its products post-Brexit, but it is also clear that with the right support in place, our dairy exporters will be well placed to continue to export their much-loved to international consumers.

“The Dairy APPG hopes that these recommendations will help provide central government and relevant departments with guidance on supporting dairy exports and the sector long-term.”

The full report can be found here.

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