As the rise of grass-fed milk is not long, there is no domestic regulations on grass-fed, in addition to the domestic consumers do not understand the grass-fed milk, acceptance of the existence of a problem, the consumption needs to be cultivated. So whether grass-fed milk can become the next hot category, but also depends on how the dairy layout.

The rise of grass-fed milk

With the rise of the concept of grass-fed, grass-fed dairy products have also become one of the faster-growing categories in the dairy industry, according to the U.S. Dairy Industry Analysis data, the growth rate of grass-fed dairy products is as high as 30% -50%; from 2012 to 2017, grass-fed milk sales increased by three times! more, with sales in 2017 reaching 2 million gallons, or about 7.4 million liters.

This has led to a number of dairies joining the grass-fed circuit, and products have been extended from powdered milk to liquid milk categories, with a number of grass-fed milks coming to market in both the low-temperature and ambient sectors. And in a "birth" of the positioning to high-end products, to provide consumers with high-quality products.

At present, grass-fed dairy products on the market are mainly milk powder. 2019 Mead Johnson in China launched the "five-star grass-fed Anerbao series" infant formula, but also added natural prebiotics and DHA, to help support the absorption of brain development; Abbott launched Pure Bliss infant milk powder; this year, the company announced on April 29th, Danone announced that it would be the first to launch a grass-fed milk powder in China. On April 29, Danone announced the official launch of its first infant formula, Nuoyuan 3 Aloe, which was launched at its Qingdao plant specializing in special nutrition and was selected from the world's rare grass-fed milk sources; and Mankind launched a 100% GRASS FED-certified pure grass-fed milk formula. In addition, brands such as Yili and Gopei have also launched grass-fed infant formulas.

On April 17, 2020, "Choose Fresh, Drink Healthy, Live Well", the 5th Pasteurized Fresh Milk Festival of Weigang was held online. In this festival, Weigang launched a heavily upgraded product - the most pure grass-fed fresh milk.

On the e-commerce platform, there are also brands such as Porphyry, Ayn Moore, Anjia, Albertson's, Ai's Morning Glory, Miaoco, New Zealand, Newmarket and so on, all claiming to be grass-fed milk, but these products are basically room-temperature milk.

Currently, the grass-fed milk market is dominated by powdered milk and ambient milk, and low-temperature grass-fed milk is almost a dime a dozen, but the low-temperature milk market has been hot in recent years, and new grass-fed products are likely to emerge in the future.

Dairy's focus on grass-fed milk

Grass-fed milk's natural, healthy attributes are highly sought after by consumers, and in 2016, Whole Foods, the largest U.S. health-food retailer, recognized "grass-fed" as a new consumer trend and predicted that "In 2016, Whole Foods, the largest health food retailer in the United States, recognized grass-fed as a new consumer trend and predicted that grass-fed would be the next most sought-after health concept after organic.

There is an old saying that "rarity is precious", and things that are rare are often more sought after. Because grass-fed milk has strict standards and requirements for the environment, cow diet, antibiotics, hormone use, etc., this has led to the production of grass-fed milk is not high.

It is understood that only 10% of the world's milk belongs to the outdoor "grass-fed milk", even in the more developed dairy countries, most of their cows live in feedlots or factory farms.

And a lot of dairy companies that want to differentiate themselves choose to enter the field of grass-fed milk, hoping to differentiate themselves to win the market.

In order to open up the visibility and branding of grass-fed milk, many companies choose to cooperate with e-commerce, variety shows, anchors and popular IPs to enhance visibility.

For example, Gao Pei Zhen Ai grass-fed milk powder and a lot of net red anchor cooperation, and also continue to develop maternal and child channels, to achieve the online and offline integration of the development strategy, but also sponsored a variety show, "planting it Ma Ma," which a number of stars to the audience to popularize the advantages of grass-fed milk, so that consumers really understand the grass-fed milk; Mead Johnson launched the powder milk Anerbao and national IP "Kung Fu Panda The cooperation between Mizzen's milk powder Anerbao and national IP "Kung Fu Panda" has increased the attraction to children; Yili Gold Crown Rui Guan rare grass-fed milk powder and Youku Children's Channel cooperated with the variety show "Nature Super Fun" to expand the influence.

Grass-fed milk has room for development

It's worth noting that grass-fed milk has higher requirements for farms, milk sources, and the supply chain, which has led to a scarcity of products. The so-called "grass-fed" refers to the cattle breeding mode closer to the nature, the cows back to the free-range, to grass for food, so that the cows in line with the laws of the natural habits and conditions of life under the production of milk. It's a bit different from the large-scale farming and grain-feeding that's common in China nowadays.

Therefore, the domestic development of grass-fed milk, especially low-temperature grass-fed milk is more difficult. The degree of dependence on the milk source, resulting in less low-temperature grass-fed milk in the country. But with the industry's successive bids and construction of farms in the past few years, the development of grass-fed low-temperature milk has the possibility.

According to market research consultancy QYResearch, the global grass-fed milk market size has reached USD 19 million in 2018 and is expected to reach USD 77.6 million by 2025. And China's grass-fed milk consumption will maintain double-digit growth in 2019.

From the point of view of consumer preferences, farm construction, imported milk sources, and growth rate, China still has the space for the development of grass-fed milk, and it is a good choice for dairy enterprises to enter into the segmented category.

Grass-fed regulations and market education become a pain point

From the current public information, there are differences in the standards of grass-fed countries. For example, the U.S. grass-fed certification requires 60% and above grass-fed rate, the other part can be fed with fodder, the annual stocking time needs to be 150 days and above, relatively loose requirements.

New Zealand's AQ standards are relatively more stringent, requiring cows to be free range for 350 days or more of the year, with an average of 96% fresh grass in the total feed; the EU Grassfed requirement requires 300 days of free range time per year, and no GMO feed can be used.

Only dairy products that meet the appropriate standards will be certified and labeled as "grass-fed milk". The grass-fed milk market is still in the early stages of development, as there is no grass-fed standard in China, and it may be difficult to scale up for the time being.

For the domestic market, grass-fed milk is an emerging category, and market acceptance is still relatively low. Plus, imported grass-fed milk products are more expensive, for example, infant formula costs between 300-400 yuan per can, almost double the price of regular formula.

This discourages some consumers. In addition, consumers do not yet have a clear understanding of grass-fed milk, which requires the entire dairy market to educate consumers about consumption, in order to open up the market for grass-fed milk, which is conducive to future development.