Asia Pacific A2 Milk Market

Asia Pacific A2 Milk Market Analysis:

Asia Pacific A2 Milk Market is estimated to experience reasonable growth to record a CAGR of xx.xx% throughout the estimated period (2022 - 2027).

There are two variants of the beta-casein protein in cow's milk: a1 and a2. Milk that contains only the beta-casein a2 protein is called a2 milk. A2 milk is derived from specific breeds of cows that produce the beta-casein protein in their milk with a proline number of 67. These cows are older breeds and are found mainly in India. A2 milk has more nutritional value than normal milk because it contains nutrients such as calcium, potassium, vitamin D, and protein. Many people have found that milk that does not have A1 beta-casein and is high in A2 beta-casein is easier to digest. A2 milk reduces the risk of heart disease and inflammation associated with dairy products. A2 milk production takes place more in the Asia-Pacific region. Due to increased applications and growing demand, the a2 milk market is expected to proliferate in terms of value and volume during the forecast period. The Asia Pacific A2 Milk Market is expected at USD xx.xx million in 2021 and is anticipated to the extent an over of USD xx.xx million by the end of the assessment period

Recent Developments 

In 2018, Nestlé S.A. launched its new organic and natural product, “illuma Atwo.” Illuma Atwo is an infant formula formulated with A2 milk. This is expected to expand the company's product portfolio and strengthen its market position during the forecast period.

In February 2019, Fonterra Co-operative Group signed an agreement with farmers to supply milk to the a2 Milk Company Limited for the 2019-2020 season in New Zealand. The Fonterra cooperative dairy is expected to be based in Waikato, near its Hautapu site in New Zealand. This is expected to increase the supply of high-quality milk to The A2 Milk Company.

In November 2019, the a2 Milk Company Limited extended its supply agreement with Synlait Ltd., a New Zealand-based dairy company. The supply agreement includes platinum and other nutritional products from the a2 Milk Company Ltd. This is expected to increase the volume of nutritional products manufactured by Synlait exclusively for the a2 Milk Company Ltd.

A2 Milk Company Ltd. said on December 24 that it had entered into binding agreements to purchase the proposed 75% stake in New Zealand-based Mataura Valley Milk Ltd. for NZ $ 268.5 million. In August, a2 Milk made a non-binding offer to acquire a stake in Mataura Valley Milk in a deal that gives the dairy nutrition company belonging to the China Animal Husbandry group an enterprise value of NZ $ 385 million. The state-owned China Animal Husbandry Group, which is the parent company of a2 Milk's trading partner in China, will hold the remaining 25% in Mataura Valley Milk.

A2 Milk has previously signaled its desire to improve direct gross sales in China after the company's main daigou reseller channel collapsed due to COVID-19, causing a gross drop of nearly 500 million sales. The head of government, Geoff Babidge, said the agreement with Mataura and CAHG might be essential in establishing a strong base of operations in New Zealand while forging a deeper bond with A2's Chinese colleagues.

Market Drivers and Restraints:

The problems related to the digestion of milk are increasing among consumers around the world. Many people are afraid of consuming milk because they experience gas and bloating after consuming regular milk or milk that contains beta-casein A1 protein. A2 milk is easier to digest as it only contains the protein a2-beta-casein. A2 milk can be used as an alternative to infant milk. As we all know, breast milk is very important for babies for good health and growth. But there are many cases when mothers cannot give their children enough milk. In such cases, a2 milk is a great alternative, as it is quite comparable to breast and goat milk. In addition, many manufacturers use A2 milk to manufacture baby food. Every year several manufacturers launch many new baby food products, increasing the market share of a2 milk. An increasing number of people around the world suffer from heart disease. Additionally, a large number of people suffer from dairy-related inflammation while consuming regular milk. A2 milk reduces the risk of inflammation and heart disease associated with dairy products in consumers that are leveling up the shares of the Asia pacific A2 milk market. Milk is a daily food ingredient that is used in various dairy products. Milk is consumed all over the world as healthy food, as it contains various nutrients necessary for human and animal health. One of the main nutrients in milk is fat, which is considered a good fat. The fat content of A2 milk is higher than that of normal milk. In normal milk, the fat content is approximately 3.6%, while in A2 milk, it is approximately 4.8% fat. The trend to eat healthy food is increasing among consumers around the world. This attribute is also anticipated to fuel the demand of the Asia Pacific A2 market. Milk is considered one of the most consumed foods in the world. Milk is largely consumed because it is considered a healthy product. But there are a growing number of people who are unable to consume milk and dairy products due to indigestion problems. A2 milk is easier to digest, which is why it is highly demanded by consumers as a healthy food that can be easily digested.

However, lack of awareness and increasing cost are slowly declining the demand of the Asia Pacific A2 milk market. 

Market Segmentation

Based on the form, liquid segment is ruling with the dominant shares of the market.

On the basis of packaging, the bottle segment dominates during the forecast period, as A2 milk bottles are easy to transport and cost-effective.  

By distribution channel, the retail segment dominates during the forecast period.

Impact of COVID-19 on Asia Pacific A2 Milk Market

The onset of the pandemic, COVID-19, has resulted in the establishment of an epidemic. It has undermined the dairy supply chain and disrupted the entire value chain of dairy inputs, from sourcing raw materials to manufacturing, packaging, and delivery. Due to COVID-19, there has been a domino effect in the dairy industry, which has caused a decrease in the demand for dairy products, especially as an ingredient, which has caused the spillage of excess purchased A2 milk. Dairy cooperatives are encouraged to buy milk, such as A2 milk, from farmers to provide them with income. However, the demand for A2 milk is experiencing a decline in demand, putting dairy companies in a difficult situation. This also resulted in lower purchasing costs and the implementation by dairy companies of a new distribution plan. Since A2 milk suppliers in several countries are experiencing declining growth, they are optimistic about their sales growth in China.

Regional Analysis

The Market for Asia Pacific A2 Milk has been categorized on the basis of geography to offer a clear understanding of the market. The Market for Asia Pacific A2 Milk has been divided into China, Taiwan, South Korea, India, Japan, Australia, and New Zealand, and the rest of the Asia-Pacific. Asia-Pacific is expected to record the fastest growing A2 milk market in terms of revenue during the forecast period. Factors such as the growing awareness associated with the health benefits of A2 dairy products among consumers are expected to lead to increased demand for Asia Pacific A2 milk in the coming years. According to the India Brand Equity Foundation (IBEF), the Indian dairy industry generated sales of 77.5 billion dollars in 2016 and is expected to reach 135 billion dollars in 2020 due to increased consumption, and India is also expected to be the larger dairy producer now until 2020. A2 milk is produced mainly in the Asia-Pacific region due to the presence of A2 breed cows and also due to the increasing demand for dairy products in this region.

Leading Company

Dairy Farmers had the largest share of the Asia Pacific A2 Milk Market in terms of sales revenue in 2021.

Key Players

The Asia Pacific A2 Milk Market is concentrated on well-established players. Key players in the Asia Pacific A2 Milk Market include Fonterra, Amul, Dairy Farmers, Pura, Jersey Dairy, MLK A2 Cow Milk, and A2 Milk Company Limited.