How Promasidor, Chi, FrieslandCampina drove dairy industry in 2016

Nigeria’s dairy industry has been growing rapidly over the last decade, driven by rising population of young people and urbanisation.

The industry is made up segments such as cheese, milk, yoghurt and evaporated or sour milk products.

Last year, 2016, was an interesting year for the industry, whose 95 to 98 percent inputs are often imported.

Dollar scarcity hurt many dairy firms and even pushed some to begin to reconsider their backward integration plans to ensure they source more raw materials locally.

In the drinking milk category, Promasidor Nigeria Limited led the industry in 2016 with a 29 percent retail value share, according to Euromonitor International’s recent report.

The company was among the first to concentrate more on smaller packaging for its products, which appeal more to price-sensitive consumers and school children, Euromonitor says.

“Advertising and the sponsorship of school events also helped to widen its loyal consumer base, with its Cowbell Choco brand being one of the most popular powder milk drinks amongst Nigerian children, who constitute a good percentage of consumers of drinking milk products in Nigeria,” the report explains.

On the other hand, Chi Limited led yoghurt and sour milk products in 2016 with a 34 percent value share. The company operates an effective distribution network nationwide, through which it leads many foods and drinks products such as fruit juice, and so has ensured strong popularity for its Hollandia brand, according to the report.

This brand is present in a wide variety of pack sizes, particularly in brick liquid cartons. The company also has strong advertising for Hollandia. The appealing advertising targets women, children and young adults. The company uses a lot of billboard advertising, which provides wide visibility, says the report.

Chi Limited sold 40 percent stake to Coca-Cola early last year.

In 2016, FrieslandCampina WAMCO Nigeria Plc dominated condensed/evaporated milk category with a 75 percent value share. Its Peak brand is the dominant brand in condensed/evaporated milk in Nigeria, the largest category within other dairy. The company and its Peak brand, because of their long presence in Nigeria, have built a strong, loyal consumer base which cuts across all income groups, says the report.

FrieslandCampina is currently doing the Dairy Development Programme( DDP) at four locations in Oyo State: Akele, Fashola, Isheyin and Maya.

Ore Famurewa, corporate affairs director of the dairy firm, explained to Real Sector Watch recently that the programme enabled the company to source milk from local Fulani farmers, adding that the company already had 2000 farmers who supplied milk and would in turn have a guaranteed ready market for their product.

Nigerians naturally do not consume a lot of Cheese like their European and American counterparts. However, those from South-West and some parts of Northern Nigeria consume what is popularly called ‘Wara’.

The cheese segment is still up for grabs, as growth is driven by an increased presence in retail outlets, such as supermarkets, hypermarkets and independent small grocers, which increasingly stock Western-style products.

ODINAKA ANUDU