Over 2013-2018 drinking milk products in Eastern Europe saw positive value growth, yet development was restrained by the complicated economic and political situation in Russia and Ukraine, as well as imbalance caused by the abolition of milk quotas in the EU. Milk alternatives appear to have great potential in the region, as cows’ milk stagnates. Over the forecast period the category is expected to see moderate value growth, constrained by the maturity of the cows’ milk category.
While drinking milk products in Eastern Europe developed with a value CAGR above the global average over 2013-2018, the category has not yet recovered from the sharp decrease seen in 2015. Economic and political instability in Russia and Ukraine, as well as the negative consequences of the abolition of EU milk quotas for Croatia and Czech Republic, disrupted drinking milk products’ development in the region.
Groupe Danone and PepsiCo led sales of drinking milk products in Eastern Europe over the review period. However, seven of the 10 leading manufacturers were primarily targeting their domestic markets, and imposed healthy competition by offering more affordable brands of good quality.
The general development of modern retail in the region led to its dominance in drinking milk distribution. Sales of drinking milk products through modern retail are bolstered by the abundant refrigeration facilities, widespread network and private label offering.
While cows’ milk is seeing stagnation and reaching saturation, consumers are finding milk alternatives as an interesting substitute. Positioned as healthy, lactose-free and trendy, milk alternatives are expected to grow out of the current niche perception to become more widespread in Eastern Europe.
While it has not reached the attention level of milk alternatives, goat milk saw sound volume growth in the region in recent years. Similarly, goat milk provides an alternative to the mature cows’ milk category, taps into the health and wellness trend, and is shown to be attractive to local manufacturers.
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