YILI(SH:600887) Zheng Quan Ri Bao·2025-07-15 16:58Core Viewpoint - The 16th China Dairy Industry Conference focused on how the dairy industry can break through in transformation and seek high-quality development paths amidst challenges [1] Group 1: Industry Challenges and Changes - The Chinese dairy industry is undergoing profound changes, with increasing demand for diversified, personalized, and functional products due to consumption upgrades [1] - High breeding costs, structural contradictions in milk supply, and the need for improved integration of the industry chain are significant challenges facing the industry [1] - The average price of fresh milk in major producing provinces was 3.04 yuan/kg in the first week of July, a year-on-year decrease of 6.5% [9] Group 2: Economic Impact and Financial Data - From 2023 to 2025, the cumulative income loss in China's dairy farming industry is projected to reach 70 billion yuan, with losses from fresh milk powder production amounting to 20 billion yuan [3] - In 2024, the total raw milk production in China is expected to be 40.79 million tons, a year-on-year decrease of 2.8%, marking the first decline since 2018 [3] - Over 60% of the 28 listed dairy companies in A and H shares experienced a decline in revenue in 2024, with 15 companies seeing both revenue and net profit decrease year-on-year [6] Group 3: Strategic Recommendations and Industry Support - Experts suggest that the dairy industry needs to continue reducing production capacity to stabilize prices and achieve a balance between supply and demand [3][4] - The industry is advised to adopt strategic planning and top-level design to avoid drastic fluctuations in the number of dairy cattle [4] - The Ministry of Agriculture and Rural Affairs emphasized the need for effective implementation of industry support measures to enhance competitiveness and extend the industry chain [4] Group 4: Innovation and Market Opportunities - Companies are focusing on optimizing industry structure, enhancing the entire industry chain, and exploring new product categories and consumption scenarios [8] - The dairy industry is characterized by a dominance of liquid milk, which accounted for 92.7% of total dairy product output in 2024, while deep-processed products remain underrepresented [7] - There is a growing demand for B-end dairy products, and companies are exploring opportunities in tea drinks, coffee, and baking ingredients to expand the domestic dairy market [8] Group 5: Future Outlook - Industry insiders believe that with accelerated capacity reduction, structural optimization, and the release of consumer potential, signs of a market reversal are emerging [9] - Historical experience suggests that the dairy industry operates on a cycle of approximately 7 to 8 years, with a potential turning point expected in the second half of this year to the first half of next year [9] - Companies are encouraged to innovate and embrace technology to drive the transformation of the dairy industry and meet consumer demands for high-quality, personalized products [10]