Mengniu, Guangming, and New Hope are fighting each other, and low-temperature milk strives to break through the "Free Shipping Area"

Low-temperature milk is gradually gaining popularity.
Who among Yili, Mengniu, and Guangming can get "fresh"?

If you are a milk consumer, how would you choose between room temperature milk and low temperature milk?

The former may be your long-term choice, but the data proves that the latter is being favored by more and more consumers.

Data show that in 2019, the market for low-temperature pasteurized milk reached 34.
3 billion, a year-on-year growth rate of over 11%, while the growth rate of normal temperature white milk was less than 2% in the same period.

Low temperature milk ushered in a sudden "prosperity", and this sudden enthusiasm made some people think that it is a new species with a high sense of quality.

In fact, low-temperature milk has been "snow hidden" in the domestic dairy market for decades.
During this period, the low-temperature milk companies scattered all over the country stayed on their own, each on their side.

The competitive landscape of low-temperature milk is scattered, and its high-volume development is facing multi-dimensional restrictions.

For this reason, the "wealth code" of the market may be hidden in the "yoke" break free.

In recent years, the national normal temperature milk giants Yili and Mengniu have focused on exploring the low-temperature milk track.

Several regional dairy companies have also pressed the expansion accelerator button, eager to further open the situation.
The low-temperature milk market "fights with gods" is constantly escalating in multi-dimensional confrontation.

Low-temperature milk "old trees blooming new flowers", after which players will lead the industry to evolve in what direction?

Quality, efficiency, distance

Quality, efficiency, distance

"Low temperature" three shackles to be removed

"Low temperature" three shackles to be removed

When talking about low-temperature milk, another part of milk products-room temperature milk has to be mentioned.

"Mantis Finance" found that the low-temperature milk circuit has gained attention again, and there is a "dark line" buried here.

In the past, after the introduction of UHT sterilization technology, room temperature milk rose widely.

At the same time, leading companies such as Yili and Mengniu have laid out large-scale channels and continuously invested in marketing, realizing the rapid expansion of room temperature milk channels and categories.

Subsequently, room temperature milk shifted to product structure upgrades and price increases, and sales volume declined for three consecutive years after 2016.

The growth rates from 2017 to 2019 were -2.
06%, -1.
07% and -0.
98%, respectively.

This actually reflects that the era of "volume increase" in the room temperature milk industry has passed, and the dairy market needs new "increment".

In this context, low-temperature milk has surpassed normal-temperature milk and has become a hot spot that may be detonated under the development of the industry.

According to Euromonitor data, the representatives of low-temperature pasteurized milk in 2018 are Bright, Sanyuan, and New Hope Dairy, with corresponding market shares of 11.
5%, 9.
2%, and 5.
9%, respectively.
They do not occupy a high market share, and the industry has not been significantly centralized, so individual leaders may be bred in the future.

But the reality is that there are still some problems in the low-temperature milk industry that urgently need to "break the ice.
" As companies in the product chain continue to improve on the technical level, they are gradually being "melted", and the industry is also undergoing heavy development.
The low-temperature milk circuit has received attention again, and another "dark line" is here.

"Mantis Finance" believes that the problems of the low-temperature milk industry are mainly manifested in many aspects, including the three dimensions of "quality", "efficiency" and "distance".

From the perspective of "quality", the production process of low-temperature pasteurized milk is different from that of room temperature milk, and it has higher requirements for the quality of raw materials, which is difficult to guarantee if it is a non-large-scale pasture;

In the subsequent transportation links, pasteurized milk must be kept in a proper refrigerated and fresh-keeping state throughout.
At this time, the quality places high requirements on cold chain storage.
The latter is the obstacle to the operation of low-temperature pasteurized milk by many dairy companies.

It is worth noting that if the transportation link is optimized, the problem of the "distance" dimension will also be solved from one direction.
The domestic consumption area and the golden milk source are separated from the north to the south, and the optimization of transportation links can help realize long-distance, cross-regional transportation and distribution.
Another solution is to set up a new pasture adjacent to the consumption area.

For the "efficiency" dimension, the key lies in the distribution of low-temperature pasteurized milk.
Under the premise of normal cold chain transportation, the shelf life of low-temperature pasteurized milk is about 5 days, and promotional discounts generally start on the fourth day.
In other words, the first three days are important sales time.
How the industry efficiently allows consumers to buy goods will determine whether it can expand profits.

Therefore, the "dark line" in the three dimensions intersects with the first "dark line", waiting to be ignited.
In the past two years, the company has deployed a low-temperature milk track, which has brought about progress in the objective environment of the industry and successfully "detonated" the track.

"Radius" is a spear, and "Circle center" is a shield

"Radius" is a spear, and "Circle center" is a shield

Mengniu and New Hope fight against the new blue ocean

Mengniu and New Hope fight against the new blue ocean

"The breakthrough development of the industry is reflected in the application.
There are two alternative paths and a key word that must be possessed," an industry insider told Mantis Finance.
"The former is to extend the radius and increase the center of the circle, and the latter is to meet the consumption frequency.
.
"

"The continuous improvement of domestic cold chain logistics infrastructure has just laid the foundation for the company's "extended radius"," the industry insider said.

According to data from the Cold Chain Committee of the China Internet of Things, from 2017 to 2019, the scale of China's cold chain logistics market continued to expand, with an average annual compound growth rate of 15.
3%.
In 2019, the market size of the cold chain logistics industry reached 339.
1 billion yuan, a year-on-year increase of 17.
5%.

Some investors pointed out that due to the success of Mengniu and Yili in the low-temperature yogurt category, their relatively leading cold chain quantity and quality will help to develop low-temperature pasteurized milk.

After 2018, Mengniu and Yili successively entered the field of low-temperature pasteurized milk.
Mengniu established an independent fresh milk business unit in 2018; Mengniu's 2019 annual report shows that Mengniu's fresh products have covered 24 provinces and 50 key cities; in October last year, it partnered with Coca-Cola to establish "Ke Niu Lai" to enter high-end low-temperature milk.

Image source: Mengniu Daily Fresh Words

"Mantis Finance" learned that Mengniu has enriched its strategy of "stretching the radius" in order to expand the low-temperature pasteurized milk nationwide.
Specifically, on the basis of mature cold chain transportation, ESL and other technologies are used to produce pasteurized milk with a longer shelf life.
This can extend the shipping period and extend the reach of business to further consumer locations.

From another perspective, it also means that the distance between the place of production and the place of consumption has become more controllable.
Mengniu's production plants do not need to be located outside the core consumer cities, but can choose more distant neighboring cities, and ultimately achieve "extended radius".

Mengniu's old rival, Yili, launched three new low-temperature fresh milk products at the end of 2019.
The layout signal is released.
However, Yili is conservative in this area.

Last year, Liu Chunxi, vice president of Yili Group, said, “In the future, China’s dairy products will still be mainly liquid milk at room temperature.
Yili will continue to develop the room temperature business while actively deploying low-temperature business.
” Although he said that he would still do something, this seems to be the first time Yili has publicly expressed its caution on the low-temperature milk circuit.

In addition to "stretching the radius", "increasing the center of the circle" is another path, which typically represents a new dairy industry.
Currently, it is difficult to develop new pastures around developed cities, and the transportation radius of low-temperature pasteurized milk is limited.
Therefore, New Dairy has adopted the method of acquiring local brands in order to penetrate into the "hinterland" of competitors.

Since 2002, New Dairy has set off two rounds of acquisitions.
The first round of acquisitions of regional dairy companies in West China, Shuangfeng, Tianxiang, etc.
, to attack the East China and North China markets; the second round of acquisitions of Hunan Nanshan cut into the Central China market, followed by the acquisition of Shuangxi, Sanmu, etc.
, and continued to increase.

Through the acquisition of local low-temperature milk brands, New Dairy can quickly obtain its local brand recognition, channels, and overall planning capabilities.
Exploit the market and form coverage and penetration of new market areas.

In 2019, New Dairy entered the A-share market, and subsequent expansion continued to accelerate.
Acquired different proportions of shares in Australian Cattle Dairy, Modern Dairy and Huanmei Dairy.
As a result, the nationalization of the new dairy industry for regional dairy companies has become very clear.

If the above-mentioned companies are the "juniors" in the low-temperature milk market, then Guangming can be said to be one of the "veteran" companies.
As a veteran dairy company in the Yangtze River Delta region, it missed the opportunity for the development of room temperature milk in the past and was surpassed by Mengniu and Yili.
So Guangming worked hard and accelerated its layout in the low-temperature milk market.

Image source: Guangming Youbei

Bright Dairy completed the acquisition of Jiangsu Huishan Dairy.
On this basis, it established a production plant and ranch with Jiangsu Yinbao Group.
Industry insiders told Mantis Finance that "the purpose of this move may be to occupy a favorable position in advance, and use this as a starting point to radiate the target market to the surrounding areas.
"

In addition, Guangming has already built its own distribution platform to "order as you wish", which currently covers at least 34 large and medium-sized cities across the country.
This reflects that Guangming is also committed to "stretching the radius" and gradually improving the cold chain distribution system.

On the whole, all dairy companies are focusing on the strategy of "stretching the radius" and "increasing the center of the circle" in order to expand the national territory again.
Giants participate in amplifying the volume of low-temperature pasteurized milk, but the overlap of strategic layouts naturally brings fiercer competition.

The cold chain transportation system is improving rapidly, and companies with scale advantages will continue to reduce supply chain costs in the competition.
As a result, regional leaders will inevitably face the "squeeze" of national leaders.
From the perspective of competition, in the face of the pressure that may arise, dairy companies naturally need to squeeze in a race to gain market share.

"For low-temperature pasteurized milk, if dairy companies do not occupy the blank market first, they may lose opportunities because the market will not wait for you," an industry insider told Mantis Finance.

In line with mature markets, new retail "on the car"

In line with mature markets, new retail "on the car"

Where does the low-temperature milk "tuyue" blow?

Where does the low-temperature milk "tuyue" blow?

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：Foodaily

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