Domestic sales summary
The supermarket channel’s share of Australian drinking milk sales has been relatively steady over the last five years at around 53-54%. Supermarket sales volumes grew by 1.3% in 2015/16; with the comparative sales performance between private label milks (+2%) and dairy company branded milks (+0.5%) delivering marginal market share growth to private label milks of 0.1% share points to 54.8%.
The private label brands’ share of total supermarket milk volumes has been relatively stable over the last couple of years; and up from around 25% back in 1999/2000. Looking more closely at the fresh white milk segments, where the majority of the pricing activity of recent years has occurred, private label brands currently account for 64% of fresh white regular full cream milk and 51% of modified fresh white milk sales. However, this changed quite dramatically in May 2016, with consumers responding to prominent social media campaigns to support Australian dairy farmers through increased purchases of branded milk.
In 2015/16, the average price of company branded milk rose very slightly from $2.17 to $2.18 per litre, with increases in modified fresh white and flavoured milks offsetting a fall in the average prices of UHT milks. Average private label milk prices have been stable at $1.02 per litre since early 2011. In line with the volume growth seen during the year, the total retail value of all supermarket milk sales increased by 1.3% to more than $2.1 billion.
The average price of private label products is significantly less than company branded products,due to a combination of product and pack sizemix – with a greater proportion of private label purchases being larger plastic bottles of regular full cream milk.
On the packaging front, plastic bottles account for nearly 80% of all milk sales in supermarkets, with the balance split between gable-top cartons (6%) and UHT cartons (14%).
There have been significant movements within the pack sizes bought by consumers in supermarkets over the last decade. However, the 2-litre plastic bottle remains the most popular size, with 47% share. The combined share of 1-litre cartons and plastic bottles has slipped from 33% to 16%. The major change has been in the rapid growth of the 3-litre plastic bottle, increasing its share of all supermarket milk sales from 13% when it first appeared in June 1998 to around 31% currently.
Total cheese sales volumes through the supermarket channel grew by around 2.0% in 2015/16. However, average retail prices decreased by 1.7% on the previous year, so that the total value of retail sales through the supermarket channel remained more-orless unchanged, at slightly more than $2.1 billion.
It is estimated that around 50% of the domestic sales of Australian dairyspreads were through supermarkets. Supermarket sales volumes increased 3.6% in 2015/2016, together with a 3.0% increase in average retail prices during the year, delivered an increase in retail sales value of 3.8% over the previous year to more than $432 million.