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Benefiting from health trend
While many cheese products are high in fat, the category is generally benefiting from an increasing consumer focus on the nutritional content of foods. The fact that the high fat content of most cheese is naturally occurring and not added means that many cheeses are exempt from the new law on labelling that requires a prominent black label for products containing certain levels of saturated fat, sodium, sugar or calories.
Expanding range of consumption occasions
Rising consumer health-consciousness is helping to extend the range of consumption occasions in which Chileans turn to cheese. For example, cheese is becoming an increasingly accompaniment to bread at breakfast.
Unpackaged hard cheese to remain dominant
Unpackaged hard cheese is expected to remain the dominant and fastest-growing category over the forecast period. The category’s strength is supported by its wide distribution through both traditional and modern channels, its affordability and the fact that it is perceived as natural.
Leader sees share eroded
Amongst the best known players in the Chilean dairy market, Cooperativa Agrícola y Lechera de la Union retained the lead in cheese in 2018. The company has a wide product portfolio, spanning spreadable processed cheese, packaged hard cheese, unpackaged hard cheese, soft cheese and other types.
Watt’s expands strongly
Watt’s was the fastest-growing player in cheese in 2018, thanks to its dynamic performance in unpackaged hard cheese. The company, which is entirely focused on unprocessed hard cheese, saw its packaged hard cheese sales decline for the third successive year in current value terms in 2018, while it registered double-digit current value growth in the unpackaged segment.
Potential for diversification
Improving economic conditions during the forecast period may have the potential to support a diversification of demand in cheese in Chile. This could involve companies introducing new cheese styles from other countries, as well as investing in innovation around cheeses that are already established in the Chilean market, with the launch of organic, low-fat and lactose-free varieties, for example.
Cow’s milk compatible with evolving demand
Cow’s milk, which is almost entirely reliant on sales of shelf stable products, is expected to see significant growth over the forecast period, as it benefits from a naturally healthy image in line with evolving demand trends. While rising consumer health-consciousness is set to be a key driver of growth in the category, it is notable that semi-skimmed and full-fat milk are expected to outpace skimmed milk in terms of value growth over 2018-2023.
Milk alternatives growing strongly
Milk alternatives is expected to see the fastest growth in drinking milk products over the forecast period, despite the contraction of soy drinks, the largest milk alternatives category. Indeed, other milk alternatives, which include products such as almond, rice and coconut milk, is set to overtake soy drinks in terms of value sales in the final year of the forecast period.
Growing focus on health-orientated innovation
Health-orientated innovation will be an important feature of new product development in drinking milk products over the forecast period. As well as the ongoing development of lactose-free products, the category is likely to see the expansion of functional and fortified products, such as those with added vitamin D.
Four players dominate
Soprole, Watt’s, Nestlé Chile and Cooperativa Agrícola y Lechera de la Union jointly dominate drinking milk products in Chile. Soprole, Watt’s and Cooperativa Agrícola y Lechera de la Union are primarily reliant on shelf stable cow’s milk.
Watt’s and Soprole see fastest growth
Watt’s and Soprole were the two most dynamic major players in drinking milk products in 2018. Both companies expanded strongly in shelf stable milk, with Soprole focusing on its eponymous brand, while Watt’s saw both the Loncoleche and Parmalat brands register significant increases in sales during the year.
Other milk alternatives to attract investment
While milk alternatives was dominated by Coca-Cola and Watt’s in 2018, these players were reliant on the larger soy drinks category. The expanding other milk alternatives category, set to outgrow soy drinks by the end of the forecast period, is led by Comercial Nuevo Hogar and Vivalife.
Yoghurt benefiting from new law
Aided by manufacturer reformulation in order to avoid the new black food labels warning consumers of high levels of sugar, sodium, saturated fat or calories, yoghurt was a notable beneficiary of the food labelling law introduced in 2016. Yoghurt managed to remain on sale in schools and expanded to fill the gap left by newly prohibited products, including high-sugar soft drinks.
Manufacturers aim to take category upmarket
Towards the end of the review period, manufacturers increasingly focused on promoting the premiumisation of the category. With consumer-awareness of the ingredients and nutritional value of products enhanced by government measures to tackle the country’s obesity crisis, this increasingly involved marketing and new product development focused on health and wellness.
Wide-ranging consumption occasions offer platform for expansion
Yoghurt is already consumed throughout the day in Chile. While it is most commonly eaten as a healthy mid-morning snack, it is also consumed at breakfast, as part of a dinner prepared with fruit, muesli and/or cereal, as a dessert and, sometimes, as a cooking ingredient.
Soprole retains lead
Soprole retained the lead in yoghurts and sour milk products in 2018, expanding its value share as consumers attracted to the category in an increasingly health-conscious environment looked to its established brands, which are widely available through the company’s extensive distribution network. Moreover, Soprole is engaging in innovation aimed at taking advantage of the opportunities presented to yoghurt through new health-focused food legislation, including launching the new probiotic children’s drinking yoghurt, Uno Colación, in 2018.
Watt’s builds on Danone deal
Having risen from fifth to second in the rankings in yoghurt and sour milk products in 2017 with the acquisition of Danone Chile’s assets and a licensing agreement for the use of the Activia, Danone and Danone Light brands in Chile, local player, Watt’s further expanded its share in the final year of the review period. The deal, which included a plant in Chillan and the Calan brand, fits the domestic company’s broader development strategy, which is focused on adding value to its portfolio.
Opportunities for healthy children’s products
As parents become increasingly conscious of the nutritional value of their children’s food and products such as high-sugar soft drinks are no longer available in schools, yoghurt manufacturers are set to focus strongly on the development of healthy snack products for children. In 2018, category leader, Soprole, notably launched a new probiotic drinking yoghurt for children, Uno Colación, in an 80ml Tetra Pak container.
Benefiting from reformulation
Other dairy entered the forecast period on a positive note, seeing expanding sales of chilled dairy desserts, which benefited from manufacturer reformulations that enabled such products to avoid having the black labels required for products with high sugar, fat, sodium or calorie content. Moreover, the reformulations have enabled chilled dairy desserts to remain in schools while rival products were banned.
“Foodie” trend offers opportunities
Improving economic conditions, the more cosmopolitan tastes of well-travelled younger consumers, and a wave of new fine dining restaurants in Santiago are all contributing to the development of a “foodie” trend in Chile. This presents opportunities for other dairy products, with condensed milk and cream increasingly being positioned as ingredients for home cooking, as consumers become increasingly interested in experimenting with preparing new dishes.
While rising health-consciousness is a primary influence on demand across packaged food in Chile, the increasing consumer interest in gourmet food presents opportunities for the development of indulgence products. In fact, growing consumer concerns about health and nutrition have the potential to bolster demand for higher-end indulgence products by encouraging consumers to opt for quality over quantity, eating fewer but more upmarket products.
Nestlé Chile holds lead
Nestlé Chile remained the leading player in other dairy, with a strong presence across categories, including holding top spot in cream, plain condensed milk and flavoured condensed milk, as well as ranking second in chilled dairy desserts. The company benefits from a long-standing presence in the market and a reputation for quality across a number of packaged food categories, as well as a strong distribution network.
Soprole focuses on eponymous brand
Soprole was the fastest-growing major player in other dairy in 2018, thanks in large part to its dynamic expansion in chilled dairy desserts. In contrast to Nestlé, which utilises a broad brand portfolio in other dairy, Soprole relies on its eponymous label for more than 99% of its other dairy sales.
Using digital media to promote positioning as cooking ingredients
The development opportunities resulting from the “foodie” trend and consumers’ growing interest in experimenting with cooking new dishes are encouraging manufacturers to promote products such as cream and condensed milk as cooking ingredients. A key element of this strategy is the use of digital channels, including Facebook, YouTube, Instagram and company/brand’s own websites, to share recipes.
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Discover the latest market trends and uncover sources of future market growth for the Dairy industry in Chile with research from Euromonitor's team of in-country analysts.
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The Dairy in Chile market research report includes:
Analysis of key supply-side and demand trends
Detailed segmentation of international and local products
Historic volumes and values, company and brand market shares
Five year forecasts of market trends and market growth
Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
What is the market size of Dairy in Chile?
What are the major brands in Chile?
How has the economic downturn impacted sales performance given its staple food status?
Given mounting obesity concerns, are consumers moving from full-fat to reduced fat/fat-free offerings?
How are volatile farmgate prices for milk impacting retail prices and sales performance?
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Gain competitive intelligence about market leaders
Track key industry trends, opportunities and threats
Inform your marketing, brand, strategy and market development, sales and supply functions
Local players and private label see strong performances
Modern grocery retailers continue to dominate
A stable economy set to support ongoing growth
Sales to Foodservice
Consumers show willingness to pay for higher quality products Healthy options proving popular Convenience important
Consumers appreciate convenience of foodservice Shopping centres popular destinations Home delivery/takeaway on the rise
Table 1 Foodservice Sales of Packaged Food by Category: Volume 2013-2018 Table 2 Foodservice Sales of Packaged Food by Category: % Volume Growth 2013-2018 Table 3 Forecast Foodservice Sales of Packaged Food by Category: Volume 2018-2023 Table 4 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2018-2023
Table 5 Sales of Packaged Food by Category: Volume 2013-2018 Table 6 Sales of Packaged Food by Category: Value 2013-2018 Table 7 Sales of Packaged Food by Category: % Volume Growth 2013-2018 Table 8 Sales of Packaged Food by Category: % Value Growth 2013-2018 Table 9 GBO Company Shares of Packaged Food: % Value 2014-2018 Table 10 NBO Company Shares of Packaged Food: % Value 2014-2018 Table 11 LBN Brand Shares of Packaged Food: % Value 2015-2018 Table 12 Penetration of Private Label by Category: % Value 2013-2018 Table 13 Distribution of Packaged Food by Format: % Value 2013-2018 Table 14 Distribution of Packaged Food by Format and Category: % Value 2018 Table 15 Forecast Sales of Packaged Food by Category: Volume 2018-2023 Table 16 Forecast Sales of Packaged Food by Category: Value 2018-2023 Table 17 Forecast Sales of Packaged Food by Category: % Volume Growth 2018-2023 Table 18 Forecast Sales of Packaged Food by Category: % Value Growth 2018-2023
Summary 1 Research Sources
Why buy this report?
Gain competitive intelligence about market leaders. Track key industry trends, opportunities and threats. Inform your marketing, brand, strategy and market development, sales and supply functions.