Core Insights - The dairy industry is experiencing a revival due to supportive policies aimed at stabilizing the economy and boosting domestic demand, despite ongoing challenges such as a prolonged decline in milk prices and cost pressures [2][3] - Experts highlight that the transformation in the dairy sector is not just about pricing and distribution, but also involves a technological revolution from farm to table, with a focus on product diversification and quality improvement [2][4] Industry Challenges - The dairy industry faces instability in comprehensive benefits, uncoordinated development between farming and processing, and an imbalance in supply and demand, leading to increased costs and declining profits [3][4] - Recent data indicates a projected 3.1% decline in the dairy product industry sales in 2024, with raw milk production expected to decrease by 2.8% and dairy product output down by 1.9% [3][4] - The average price of fresh milk in major production areas was reported at 3.07 yuan per kilogram as of May 15, reflecting a nearly 30% drop from the peak in September 2021 [3][4] Market Dynamics - Over 80% of the dairy industry is currently facing losses, with the cost of dairy farming still exceeding the price of fresh milk [4] - The supply-demand relationship in the dairy sector is undergoing deep adjustments, with expectations of improvement in the second half of the year, although substantial changes may not occur until next year [4][5] - The low-temperature fresh milk segment has seen its market share increase from 5% in 2018 to 6.6% in 2023, indicating a growing consumer preference for this category [4][5] Innovation and Development - Technological innovation is identified as a key strategy for leading dairy companies to overcome current challenges, with a focus on breeding, smart factories, and dairy processing [6][7] - The aging population is creating significant opportunities in the silver economy, with a projected increase in the elderly population's nutritional needs, prompting the development of specialized dairy products [7][8] - The industry is shifting towards a family nutrition model, with a focus on high absorption of active nutrients and targeted product development for specific consumer groups [7][8]