Australian dairy consumption down but profitability rises
Australian households are paying more for dairy but they’re buying less milk, butter, yoghurt and cheese.
New Dairy Australia data shows consumers are reacting to higher costs of living, particularly for food, by changing where and how they spend their money.
Consumer research commissioned by Dairy Australia and undertaken by NielsenIQ found 29 per cent of Australian households had stopped buying certain categories of food altogether, as inflation concerns bite consumer confidence.
However, Dairy Australia analysis manager John Droppert said that trend was not significant for dairy sales, although shoppers were increasingly opting for generic over branded dairy produce.
In the surveyed 12-month period to October 9, sales volumes declined for long-life milk (-2.7 per cent), butter (-1.2 per cent) and cheese (-2.3 per cent).
However, sales increased for fresh milk (0.3 per cent) and yoghurt (0.9 per cent) in the same survey period.
“The pandemic years (of 2020-21) changed the way Australians purchase dairy,” Mr Droppert said. “For some shoppers, they’ve kept those habits. Particularly for people who now predominantly work from home, they’re obviously buying less dairy in cafes and restaurants and buying larger volumes to consume at home.”
The Nielsen research found that with inflation concerns at the forefront of consumers’ minds, many Australians were opting to work from home more to save on travel and hospitality expenses.
Mr Droppert said generic dairy produce was likely to remain popular into the new year.
“We find that when people are concerned about the cost of living, they tend to buy more generic produce and that includes generic dairy,” he said.
“But they still will buy some branded produce as a treat, or more sparingly.”