Lactalis Sees Recovery in Colombian Dairy Market Amid Challenges

The Colombian dairy market is showing signs of recovery following several years of declining consumption. According to Juan Camilo Velásquez, CEO of Lactalis Colombia, the market has begun to stabilize due to an improved economy, moderated inflation, and increased milk availability. Although the formal consumption of dairy products is on the rise, it has not yet returned to pre-decline levels.

Lactalis reports that the formal dairy market experienced a decline of approximately 17% between 2023 and 2024. However, over the past year, there has been a 3.5% recovery. This shift is attributed to greater macroeconomic stability, which has enhanced household purchasing power and partly restored regular consumption levels of milk and derivatives. Additionally, the availability of raw materials has strengthened industry supply chains.

Despite these positive developments, Lactalis identifies consumer misinformation about dairy products as a continuing challenge. Velásquez emphasized the need for collaboration among industry stakeholders, government bodies, and health professionals to promote informed dietary choices based on scientific evidence of dairy's nutritional benefits, including proteins, calcium, and other essential nutrients.

Changing consumer preferences are also creating new opportunities for the dairy industry. Lactalis notes an increasing demand for functional foods, particularly in categories such as Greek yogurt, kefir, and protein-fortified products. Greek yogurt, for instance, is experiencing growth exceeding 20% in Colombia, and the company anticipates it will be one of the fastest-expanding categories in the coming years. The aging population is further driving the development of products enriched with calcium, omega-3, and other nutrients tailored for older adults.

While consumption levels are improving, Lactalis underscores the need for the Colombian dairy sector to enhance competitiveness. High production costs are a barrier to consumer access to value-added products and limit the market's growth potential. The company sees opportunities to increase the consumption of derivatives like cheese, with per capita consumption in Colombia at approximately 1.5 kilograms per year, well below international markets.

In response to these market dynamics, Lactalis plans to strengthen its presence in Colombia through investments in its Medellín, Cereté, and Chía plants. The focus will be on expanding the production of value-added and functional nutritional foods to meet rising consumer demand. The company views Colombia as a promising market for growth, given its productive potential, market size, and gradual consumption recovery.