Australia appears to be falling out of love with modified milk as consumers turn back the clock in search for more straightforward dairy products.
Reduced fat white milk consumption has slipped about seven per cent in the past three years while full cream milk sales have risen about 4pc.
For more than a generation modified “lite” and “skim” milk products have been underpinning growth, and milk company profits, in the consumer milk market.
The original reduced fat lines also spawned a host of “me too” variations boasting added vitamins for different consumer demographics.
“I’m amazed at the recent rate of change in consumer habits,” said Lion Dairy and Drinks managing director, Peter West.
“It’s a trend that was unimaginable a decade ago.
“People are suddenly actively seeking out more natural or less processed products.
“Admittedly, full cream milk contains very little fat in the first place (about 4pc), but people also appreciate it tastes so much better.”
Mr West said consumers also recognised putting milk through a process to remove cream did change the components in a glass of milk, effectively increasing the overall lactose (sugar) content.
Those same concerns about extra processing and sugar had helped fuel the rise and rise of traditional yoghurt demand.
Greek and natural yoghurts now represent almost half all yoghurt sales in Australia - or 77,870 tonnes in the 12 months to October 2016.
The trend is good news for several reasons, according to Mr West, who argues Australians have long tended to overlook the nutritional value of dairy products, including fresh chilled milk lines.
“Almost 90pc of Australians do not get their recommended three servings of dairy a day – most are averaging about 1.5 servings,” he said.
Mr West believed the dairy industry’s regulated marketing history had possibly undervalued the need to highlight and champion the remarkable nutritional benefits of milk products, particularly in recent decades.
“We see it as an important message story to tell – explaining the incredible consumer impact of what we are selling,” he said.
“We’re planning some announcements focused on celebrating that nutritional story later this year.”
The providence of fresh Australian dairy products and their nutritional value was also a major selling point for Lion’s push into Asian markets with yoghurt and milk products.
Lion already sends about 5pc of production from its Morwell yoghurt plant to South East Asia.
Sales into Malaysia had recently risen about 20pc on the back of restructured distribution and promotion efforts highlighting the Australian credentials of Lion’s brands.
However, the company was taking a carefully pragmatic approach to developing its export footprint into key capital city markets in protein-hungry China.
“We’re excited by the opportunities in China, but continuing to learn how to get the proposition right,” Mr West said.
“We’re probably likely to look at opportunities that might get us involved with local players already in the market.”
Lion recently began processing fresh milk under the Van Milk label for the Van Diemens Land Company (VDL) which is flying product from Tasmania to Ningbo in China each week.
VDL Farms’ owner, Moon Lake Investments, hopes to export about 10 million litres a year.