“Milk producers” are milk farmers. “Milk processors” buy milk from producers and process it for the retail market. Some role players, of course, are both and are termed producer-distributors in the annual Lacto data publication by the Milk Producers’ Organisation (MPO). The reader will find some of these listed under the “Companies involved” heading. In order to survive, many farmers have extended their activities beyond the farmgate and are involved in both the “field” and “fork” parts of the value chain.
This page covers the processing side, the dairy secondary industry: milk powder, flavoured milk, cheese, cottage cheese, feta cheese, maas (Amazi), yoghurt, evaporated and condensed milk, cheese powder, buttermilk, cream, sour cream, butter, and milk itself – pasteurised, long-life or ultra-high temperature treated (UHT).
Further reference:
There are 130 milk processors in South Africa (in 2017 there were 145). At the beginning of 2023 there were 62 producer-distributors (PDs), down from 106 in 2017. These are milk producers who sell their own produce to retailers and consumers.
Dairy products can be divided into liquid products and concentrated products. The major liquid products in 2022 were pasteurised liquid milk and UHT processed milk (50,6%), fermented products (25,8%), fresh milk (21,1%), and sweetened, flavoured, and coloured milk (2%). Concentrated dairy products were mainly cheese (excludes cottage and cream cheese) (51,2%), butter (13,2%) and whey powder (11,1%).
The decrease in the retail sales quantities of most dairy products in South Africa, is linked to the erosion of the purchasing power of consumers by widespread increases in the prices of consumer goods and services, poor service delivery by the public sector and weak economic growth during the last five years.
In the immediate future, high input costs, weak demand and poor service delivery by the public sector, as well as a high level of uncertainty, will be the position in which the South African dairy industry will have to operate.
Source: Lacto Data June 2023; excerpts from Sampro’s “Summary of the Key Market Signals for the Dairy Industry” February 2023 Edition.
Further reference:
Milk is a “cash crop” and most people are users and cash buyers (including your neighbours!) The question is: should you sell fresh milk or add value by producing and selling fermented products (amasi, yoghurt, cream cheese)?
You can nearly double your turnover on the same amount of milk with relatively little extra cost of pasteurising and additives, and definitely make money out of a small-scale dairy.
Some considerations:
What is needed for producing fermented products?
Source: Livetrack SA
“The South African dairy industry is a critical contributor to food security, and production expansion has already exceeded the targets set for 2030 in the National Development Plan. In the processing space, it contributes to both value addition and employment in agro-processing”. (BFAP, 2021)
Further reference:
Training and research
Companies involved
Dairies and Milk Processors
Ingredients, equipment & other
Visit the websites of role players listed on this page.
