Executive Summary

Aug 2018
Prospects
Distorted price structure encourages smuggling

Price distortions caused by regulations on the milk industry continue to encourage sales of pasteurised milk to the informal channel. Given that artisanal cheese production is not regulated, manufacturers are able to pay milk producers prices at levels higher than the ceilings imposed by the government, which in turn are transferred to the final prices paid by consumers.

Hyperinflation has been flattening the price structure of cheese

The price difference between packaged hard cheese and unpackaged hard cheese makes buying the former unattractive for average Venezuelans. Traditionally, the average unit price of packaged cheese was about two and a half times higher than that of unpackaged cheese, but hyperinflation has been closing the gap.

Cultural background and income level shape the demand for cheese

Price segmentation in cheese depends largely on the product category. For instance, in packaged hard cheese, varieties such as Parmesan and pecorino are bought by high- and middle-income consumers, whilst queso de año is consumed by low-income households.

Competitive Landscape
Artisanal soft cheese maintains its leadership

Cheese is led by artisanal varieties of white cheese, which are characterised by relatively lower unit prices, and are ubiquitous in presence. In addition, there is a cultural advantage in that white cheese is the most popular filling for arepas – cornmeal patties – which supports the strong leadership of artisanal white cheese.

Local companies dominate cheese in 2018

Pasteurizadora Táchira CA enjoys a strong position in soft cheese, offering varieties such as white cheese and mozzarella under its brand Paisa. Productos Lacteos Flor de Aragua CA maintains its leadership in hard cheese through the offering of a broad portfolio of products, which includes Manchego, Parmesan and pecorino.

Prospects
Regulations along the supply chain create price distortions and shortages

Milk is not subsidised in Venezuela. Fresh milk and powder milk are on the list of price-regulated packaged food products, which implies that manufacturers are not free to set and adjust retail prices without prior government authorisation.

The insufficient supply of milk limits growth

The domestic production of cow’s milk is estimated to be six million litres a day, of which approximately 15% goes to the manufacturing of dairy products other than cheese. Production is inadequate and prices at the farm level are rising fast.

A lack of packaging is forcing changes in product presentations

Shortages of drinking milk products are becoming more severe, and product variety has weakened. Also, since the closure of the Tetra Pak manufacturing facility in 2016 – due to overdue payments not being honoured by the Venezuelan government – drinking milk products such as shelf stable milk and flavoured milk drinks have been absent from the category for long periods.

Competitive Landscape
Convelac maintains its leading position in 2018

Local manufacturer Convelac ranks first in drinking milk products in 2018, thanks to its leadership in shelf stable milk and third place in powder milk with its brand La Pastoreña. This vertically integrated company processes milk from farms located in western states and has its own packaging facilities.

A government-owned company ranks second

Industria Láctea Venezolana (Indulac) ranks second in drinking milk products in 2018, advantaged by its government-owned status; it is given high priority in the allocation of powder milk imported by the government for packaging and distribution across the country. Indulac ranks first in fresh milk in 2018 and has an outstanding share in flavoured milk drinks with two strong traditional brands El Chichero (milk and rice) and Riko Malt (milk, malt and cocoa).

Prospects
The lack of price ceilings benefits the supply of yoghurt

Yoghurt has never been under price regulation, so companies have been reallocating scarce inputs such as raw milk to yoghurt production, in a strategic move to improve the profitability eroded by government controls. The low per capita consumption of yoghurt, compared with what is seen in other countries in the region, indicates that the category has room for expansion; nonetheless, shortages of inputs and much weaker household budgets have prevented a stronger performance.

Yoghurt has room for expansion

Greek-style yoghurt is underdeveloped in Venezuela. The only available brand of Greek yoghurt, Kyros by Corporación Inlaca CA, entered the category in October 2015 but availability has been erratic as the company faces difficulties in the supply of packaging materials and raw milk.

Venezuelans consume yoghurt on many occasions

Yoghurt is consumed as a snack either mid-morning or in the afternoon when purchased in an individual format from 125g to 150g, whilst larger pack sizes such as 900ml and 1.6 litres are most commonly bought for home consumption at breakfast to accompany cereals.

Competitive Landscape
A long-life yoghurt leads the category in 2018

Alimentos Polar (migurt) steadily gained value share over the review period to reach the top position in 2015, where it has stayed. Migurt is the only brand that does not need refrigeration, and this gives Alimentos Polar a competitive advantage.

Removing the premium status is encouraging consumption in 2018

Conventionally, yoghurt is perceived as a premium product, but Alpina Productos Alimenticios CA – the leader in drinking yoghurt – is offering its Yagú brand as an economy version to encourage Venezuelans to increase their consumption of yoghurt in times of limited purchasing power. Premium options such as pre/probiotic and functional yoghurt brands, eg Alpina Regeneresis (Alpina Productos Alimenticios) and Digess (Alimentos Polar) have had an irregular presence during 2018.

Prospects
A handful of products comprises the category in Venezuela

The supply of other dairy products continues to be limited to a few categories. In fact, chilled dairy desserts, plain condensed milk and cream are the only other dairy products sold in the country.

An increase in demand is not expected for other dairy

Since none of these products is under price regulation, companies are inclined to transfer scarce inputs such as raw milk to the manufacturing of other dairy. Shortages of packaging materials, eg tin cans for condensed milk, persist and the increased presence observed in 2017 is over in 2018.

Other dairy products are part of the traditional Venezuelan diet

In Venezuela, half/single cream is a popular product that can be found in chilled or ambient format and is widely used to prepare cream-based pasta sauces. Chilled sour cream is less popular.

Competitive Landscape
Cream producers top the category in 2018

Local company Pasteurizadora Táchira CA leads sales in other dairy thanks to the solid presence of its Paisa brand, which is considered a high-quality product by most Venezuelans and enjoys a strong distribution across the country. Leadership in other dairy is tenuous, however, as chilled cream is a product derived from milk manufacturing and there are countless farmers willing to enter the market.

Fewer brands are available in plain condensed milk in 2018

Industrias Maros CA occupies third place in other dairy in 2018, thanks to Natulac, the leading brand in condensed milk. Overall, the presence of imported brands has diminished dramatically given the obstacles in obtaining import licences and the high price of foreign currency, which causes the category to comprise domestic brands mostly.

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Dairy in Venezuela

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Overview

Discover the latest market trends and uncover sources of future market growth for the Dairy industry in Venezuela with research from Euromonitor's team of in-country analysts.

Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.

If you're in the Dairy industry in Venezuela, our research will save you time and money while empowering you to make informed, profitable decisions.

The Dairy in Venezuela 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 Venezuela?
  • What are the major brands in Venezuela?
  • 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?

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

This industry report originates from Passport, our Packaged Food market research database.

Dairy in Venezuela - Category analysis

Butter and Spreads

HEADLINES

PROSPECTS

Price hikes cause sales to be erratic
Price acts as a key differentiator for Venezuelan consumers of butter and spreads

COMPETITIVE LANDSCAPE

Alimentos Polar leads the category with two brands of margarine
Local brands have replaced most imported products since 2015

CATEGORY DATA

Table 1 Sales of Butter and Spreads by Category: Volume 2013-2018
Table 2 Sales of Butter and Spreads by Category: Value 2013-2018
Table 3 Sales of Butter and Spreads by Category: % Volume Growth 2013-2018
Table 4 Sales of Butter and Spreads by Category: % Value Growth 2013-2018
Table 5 NBO Company Shares of Butter and Spreads: % Value 2014-2018
Table 6 LBN Brand Shares of Butter and Spreads: % Value 2015-2018
Table 7 Distribution of Butter and Spreads by Format: % Value 2013-2018
Table 8 Forecast Sales of Butter and Spreads by Category: Volume 2018-2023
Table 9 Forecast Sales of Butter and Spreads by Category: Value 2018-2023
Table 10 Forecast Sales of Butter and Spreads by Category: % Volume Growth 2018-2023
Table 11 Forecast Sales of Butter and Spreads by Category: % Value Growth 2018-2023

Cheese

HEADLINES

PROSPECTS

Distorted price structure encourages smuggling
Hyperinflation has been flattening the price structure of cheese
Cultural background and income level shape the demand for cheese

COMPETITIVE LANDSCAPE

Artisanal soft cheese maintains its leadership
Local companies dominate cheese in 2018

CATEGORY DATA

Table 12 Sales of Cheese by Category: Volume 2013-2018
Table 13 Sales of Cheese by Category: Value 2013-2018
Table 14 Sales of Cheese by Category: % Volume Growth 2013-2018
Table 15 Sales of Cheese by Category: % Value Growth 2013-2018
Table 16 Sales of Spreadable Processed Cheese by Type: % Value 2013-2018
Table 17 Sales of Unprocessed Cheese by Type: % Value 2013-2018
Table 18 NBO Company Shares of Cheese: % Value 2014-2018
Table 19 LBN Brand Shares of Cheese: % Value 2015-2018
Table 20 Distribution of Cheese by Format: % Value 2013-2018
Table 21 Forecast Sales of Cheese by Category: Volume 2018-2023
Table 22 Forecast Sales of Cheese by Category: Value 2018-2023
Table 23 Forecast Sales of Cheese by Category: % Volume Growth 2018-2023
Table 24 Forecast Sales of Cheese by Category: % Value Growth 2018-2023

Drinking Milk Products

HEADLINES

PROSPECTS

Regulations along the supply chain create price distortions and shortages
The insufficient supply of milk limits growth
A lack of packaging is forcing changes in product presentations

COMPETITIVE LANDSCAPE

Convelac maintains its leading position in 2018
A government-owned company ranks second

CATEGORY DATA

Table 25 Sales of Drinking Milk Products by Category: Volume 2013-2018
Table 26 Sales of Drinking Milk Products by Category: Value 2013-2018
Table 27 Sales of Drinking Milk Products by Category: % Volume Growth 2013-2018
Table 28 Sales of Drinking Milk Products by Category: % Value Growth 2013-2018
Table 29 NBO Company Shares of Drinking Milk Products: % Value 2014-2018
Table 30 LBN Brand Shares of Drinking Milk Products: % Value 2015-2018
Table 31 Distribution of Drinking Milk Products by Format: % Value 2013-2018
Table 32 Forecast Sales of Drinking Milk Products Products by Category: Volume 2018-2023
Table 33 Forecast Sales of Drinking Milk Products Products by Category: Value 2018-2023
Table 34 Forecast Sales of Drinking Milk Products Products by Category: % Volume Growth 2018-2023
Table 35 Forecast Sales of Drinking Milk Products Products by Category: % Value Growth 2018-2023

Other Dairy

HEADLINES

PROSPECTS

A handful of products comprises the category in Venezuela
An increase in demand is not expected for other dairy
Other dairy products are part of the traditional Venezuelan diet

COMPETITIVE LANDSCAPE

Cream producers top the category in 2018
Fewer brands are available in plain condensed milk in 2018

CATEGORY DATA

Table 36 Sales of Other Dairy by Category: Volume 2013-2018
Table 37 Sales of Other Dairy by Category: Value 2013-2018
Table 38 Sales of Other Dairy by Category: % Volume Growth 2013-2018
Table 39 Sales of Other Dairy by Category: % Value Growth 2013-2018
Table 40 Sales of Cream by Type: % Value 2013-2018
Table 41 NBO Company Shares of Other Dairy: % Value 2014-2018
Table 42 LBN Brand Shares of Other Dairy: % Value 2015-2018
Table 43 Distribution of Other Dairy by Format: % Value 2013-2018
Table 44 Forecast Sales of Other Dairy by Category: Volume 2018-2023
Table 45 Forecast Sales of Other Dairy by Category: Value 2018-2023
Table 46 Forecast Sales of Other Dairy by Category: % Volume Growth 2018-2023
Table 47 Forecast Sales of Other Dairy by Category: % Value Growth 2018-2023

Yoghurt and Sour Milk Products

HEADLINES

PROSPECTS

The lack of price ceilings benefits the supply of yoghurt
Yoghurt has room for expansion
Venezuelans consume yoghurt on many occasions

COMPETITIVE LANDSCAPE

A long-life yoghurt leads the category in 2018
Removing the premium status is encouraging consumption in 2018

CATEGORY DATA

Table 48 Sales of Yoghurt and Sour Milk Products by Category: Volume 2013-2018
Table 49 Sales of Yoghurt and Sour Milk Products by Category: Value 2013-2018
Table 50 Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2013-2018
Table 51 Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2013-2018
Table 52 NBO Company Shares of Yoghurt and Sour Milk Products: % Value 2014-2018
Table 53 LBN Brand Shares of Yoghurt and Sour Milk Products: % Value 2015-2018
Table 54 Distribution of Yoghurt and Sour Milk Products by Format: % Value 2013-2018
Table 55 Forecast Sales of Yoghurt and Sour Milk Products by Category: Volume 2018-2023
Table 56 Forecast Sales of Yoghurt and Sour Milk Products by Category: Value 2018-2023
Table 57 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2018-2023
Table 58 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2018-2023

Packaged Food in Venezuela - Industry Overview

EXECUTIVE SUMMARY

Hyperinflation forces the government to change regulations
Venezuelan households spend their meagre incomes on food
Increasingly concentrated competitive landscape
Supermarkets remains the main distribution channel for packaged food
Recession expected to last

FOODSERVICE

Sales to Foodservice
Unstable supply of products negatively affects foodservice performance
Confectionery continues its disappointing performance in 2018
Local manufacturers characterise sales to foodservice
Consumer Foodservice
Hyperinflation hits menu prices hard in 2018
Economic downturn impacts eating out habits
Outlets focus on desserts to survive

CATEGORY DATA

Table 59 Foodservice Sales of Packaged Food by Category: Volume 2013-2018
Table 60 Foodservice Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 61 Forecast Foodservice Sales of Packaged Food by Category: Volume 2018-2023
Table 62 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2018-2023

MARKET DATA

Table 63 Sales of Packaged Food by Category: Volume 2013-2018
Table 64 Sales of Packaged Food by Category: Value 2013-2018
Table 65 Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 66 Sales of Packaged Food by Category: % Value Growth 2013-2018
Table 67 GBO Company Shares of Packaged Food: % Value 2014-2018
Table 68 NBO Company Shares of Packaged Food: % Value 2014-2018
Table 69 LBN Brand Shares of Packaged Food: % Value 2015-2018
Table 70 Penetration of Private Label by Category: % Value 2013-2018
Table 71 Distribution of Packaged Food by Format: % Value 2013-2018
Table 72 Distribution of Packaged Food by Format and Category: % Value 2018
Table 73 Forecast Sales of Packaged Food by Category: Volume 2018-2023
Table 74 Forecast Sales of Packaged Food by Category: Value 2018-2023
Table 75 Forecast Sales of Packaged Food by Category: % Volume Growth 2018-2023
Table 76 Forecast Sales of Packaged Food by Category: % Value Growth 2018-2023

DEFINITIONS

SOURCES

Summary 1 Research Sources