THE latest statistics to be released show Australian dairy processing to be recovering from crisis.
Drought affected businesses are strengthening after an industry-wide revenue drop of nearly 5% in the 2003 to 2004 financial period.
Fortunately, positive reports from major industry players have started filtering through that show the downturn to be headed back up in the right direction.
Industry analysts attribute the down turn in part to the drought: farmers were forced to sell parts of their milking herds due to bad pasture and increasing prices, which were squeezed through the appreciation of the Australian dollar.
Accounting for around 37.5% of all dairy products in 2004 to 2005 financial year, cheese is the largest product segment.
Demand for specialty cheeses such as goat’s cheese has almost doubled in recent years, while the last 12 months saw a decline in production of all cheeses production volume of around 8.5%.
Export, according to Dairy Australia, accounts for just over half of Australian dairy products manufactured, putting Australia in third place in terms of world dairy trade.
Changing consumption patterns have increased demand for more convenience foods as more consumers are eating away from the home.
As a result of these lifestyle changes, the demand for cheese has increased as fast food outlets are topping more pizzas and manufacturers are producing more varieties of sliced and grated cheeses.
Health and dietary concerns played an important role in influencing demand for dairy, which is often perceived unhealthy and high in fat.
These concerns had an adverse effect on the demand for traditional dairy products such as butter, which sparked new promotion of the health benefits associated with dairy products.
Technology changes also allowed for the development of more enhanced and functional products, which cater to health conscious consumers wanting to reduce cholesterol or boost calcium.
Expanding product ranges in recent years has seen the development of innovative new products including specialty cheeses, easy-to-spread products and convenience products including shredded cheese and pizza toppings.
One company has recently launched a cheese in a can, and the growing niche organic food market has influenced development of a number of organic cheeses.