Campina regains footing in liquid milk sector
sustained demand for healthy dairy products helped it regain its
footing in the Dutch liquid milk sector. Tom Armitage
reports.
The company claims that despite ongoing price skirmishes in the Dutch food industry, which began to escalate in 2003, it has still managed to bolster sales growth across its liquid milk division through expanding its dairy product line and launching products such as innovative extended shelf life milk (ESL) and a 0 per cent fat milk drink.
The dairy supplier claims to have been made an unwilling victim of the long-running price war between a number of Dutch multiples, especially chains owned by Laurus and Ahold, which has forced the company to lower its profit margins as a result of lower consumer prices for branded and own-label milk.
A general decline in milk prices throughout the past year has also widened the price gap for dairy products in the Campina portfolio - which has resulted in a slip in market share for the company.
Campina, however, appears to have shrugged off this set back, and has since clawed back market share through offering a raft of self-styled 'distinctive' products, both in the traditional dairy categories - such as "vla" (a type of Dutch custard) - and also in the specialities category - which now includes, for example, a 0 per cent fat milk drink.
Earlier this year, Campina Netherlands also introduced a daily fresh milk with an extended shelf-life (ESL).
At present, the Campina innovation strategy is focused across three sectors - cheese and butter, ingredients, and drinks and yoghurt - and the strategy appears to have paid off, with the company describing recent sales of its 0 per cent fat milk brand as "exceeding the expectations of Campina Netherlands".
According to industry analysts Euromonitor, the Dutch milk market is currently estimated to be worth €570 million, which is expected to increase to €612 million by 2009. The 2004 figure combines sales across fresh and pasteurised milk and long-life and UHT milk - which are currently estimated to be worth €459 and €108 respectively.
The change of fortune in Campina's liquid milk division comes following a number of announcements concerning changes to its production arrangements.
Last week, the company announced the completion of its programmed expansion at its Campina Germany plant in Elsterwerda, north of Dresde, which will enable it to produce a line of puddings and dairy desserts, following the closure of the company's plant at Woerden.
Campina Netherlands also announced that the transfer of production for its line of canned cream from Woerden to Rijkevoort has been completed. The canned cream is produced mainly for export to markets in the Middle East.
