James O’Donnell, Shanghai Office, Bord Bia – Irish Food Board

Bord Bia recently commissioned a quarterly report covering key trends and developments in both the Indonesian and Vietnam markets. Some key highlights from the first report: With the end of the commodity boon, Indonesia dairy imports reduced by about 5% last year – however whey product imports increased reaching over 110,000t.

Milk consumption continues to increase and is presently estimated at 17 litres per capita. Growth is driven by an expanding food service sector benefiting from growth in the middle class, increases in tourism and an overall eating out culture. Reconstituted milk is a large portion of the market due to the island nature of the country and the limited cold supply chain.

The Governments Dairy Blue print targeting growth in domestic milk production has had limited success with milk production somewhat stagnant around 800,000t over the last few years. The schedule of tariff reduction agreed upon within the ASEAN-Australian New Zealand FTA will see import tariffs on most dairy products soon to be reduced to 0% .

In Vietnam dairy import values dropped significantly last year in value terms, however volumes remained relatively stable.

Both Austrilia (31.5%) and New Zealand (63.5%) had strong increases in their export of milk powder to Vietnam, whereas shipments from the US have declined (11.7%)

Under the TPP agreement yet to be ratified dairy products from US, Australian and New Zealand will be able to enter the market at 0% duty posing challenges for development of a domestic industry.

Companies wishing to receive a copy of the quarterly report please email james.odonnell@bordbia.ie