Wednesday, 15 September 2021 10:55

Lactalis soars to the top spot

Written by  Sudesh Kissun
The world's number one dairy company Lactalis owns the ex-Parmalat business in Australia. The world's number one dairy company Lactalis owns the ex-Parmalat business in Australia.

French company Lactalis has dethroned Nestlé as the world's largest dairy company.

Rabobank's annual Global Dairy Top 20 report released last month shows organic growth and a global mergers and acquisition strategy helped Lactalis unseat Nestlé.

In 2000, privately-owned Lactalis was placed ninth on the list with a turnover of US$4.8 billion.

Last year, its revenue totalled US$23b compared to Nestlé at just under US$21b.

Fonterra retains its sixth placing with total revenue of US$13.6b.

Lactalis, owned by the Besnier family, has a presence in Australia; it became a major shareholder in Parmalat's Australian business in 2011 before buying out the business in 2019.

The Rabobank report says, since 2010, Lactalis has grown its empire by adding about 60 deals, expanding its global footprint in the Middle East, Africa and North and South America.

Its pending purchase of Kraft Heinz natural cheese business and other businesses in Europe will boost revenue by another US$2.5b and extend the company's ranking next year.

The third place in the rankings has been retained by Dairy Farmers of America, the US' largest dairy co-op.

French company Danone and Chinese dairy giant Yili, which owns Westland Milk, Hokitika round up the top five.

European co-ops FrieslandCampina and Arla Foods feature seventh and eighth respectively.

The Rabobank report shows that in 2020, dairy companies faced significant challenges due to the Covid-19 pandemic, but overall, the sector fared better than expected.

The combined turnover of the top 20 industry leaders fell by just 0.1% in US dollar terms, following the prior year's 1.8% gain. In euro terms, the combined turnover decreased by 1.9%.

Merger and acquisition activity slowed in 2020, with approximately 80 announced deals versus the prior year's 105. Activity picked up in 2021, with over 50 deals announced through midyear.

Sustainability A Winner

The Rabobank report shows that in 2020, dairy companies faced significant challenges due to the Covid-19 pandemic, but overall, the sector fared better than expected, demonstrating its resilience.

The pandemic also heightened consumers' awareness of environmental challenges. A focus on sustainability was a winner for dairy companies.

"Consumer sentiments are being heard, and many companies included in the Global Dairy Top 20 have made sustainability commitments for 2030 and carbon-neutrality commitments for 2050," according to Richard Scheper, Rabobank dairy analyst.

Sustainability-marketed US milk sales grew more than 20% from 2013 to 2018, compared to negative growth for the category as a whole.

Sustainability-marketed natural cheese and yogurt sales grew over 30% and 20% respectively, compared to near 10% growth for those categories broadly over the five-year period.

The report says dairy alternatives keep growing and blurring the definition of dairy.

The sales growth of liquid milk and yogurt alternatives - especially oat and almond based variants - have not gone unnoticed.

Most significantly, Danone's turnover in dairy alternatives, following its acquisition of WhiteWave Foods in 2017, was recorded at US$2.5b, a gain of 15% compared to the previous year.


Plan makes co-op competitive

Fonterra's proposed capital structure will allow the co-operative to compete with other processors based on its milk price and overall…

Elite herd offered online

An elite Southland Friesian herd is set to become the biggest single livestock offering sold online so far.

Machinery & Products

Solution for rowdy cattle

Having walked away with a Fieldays Innovation Award and a useful cheque back in June, Springarm Products has recently signed…

Next generation swathers

Claas' latest generation of seven, dual-rotor central LINER swathers are said to offer numerous innovative features and functions to ensure…

Below ground fert server

Bavarian fertiliser spreader manufacturer Rauch is testing a prototype unit for depositing fertiliser in row crops to depths of 10…

Press screw separator

Probably best known for its chopping units that form an integral part of many manufacturers’ umbilical effluent spreading and injection…

Hydrogen power to cut emissions

While the automobile industry heads full tilt down the electrification route, heavier industries such as trucking and construction appear to…

» Latest Print Issues Online

Milking It

Seaweed saviour

OPINION: Scientists in Ireland are going underwater to solve their dairy sector’s methane conundrum.

Due recognition

OPINION: National's new leader Christopher Luxon’s first speech after his elevation to the top job included one important line about…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter