Demand for milk in Saudi Arabia is rising at around 6 percent annually due to growing awareness about its numerous health benefits. And regionally, the Kingdom accounts for 59 percent of GCC's milk consumption. Dairy companies have been influential in generating greater public interest on the positive effects of milk consumption, especially for children aged 7 to 12 years. According to the latest survey conducted by Business Monitor International, milk production growth in the Kingdom is forecast to grow 13 percent to 1.53 million tons by 2014/15. This will come on the back of strengthening milk prices and rising demand, it said. However, despite the investments made in the country's dairy industry and capacity, the processed dairy product sector is still negligible, the survey added. Milk is regarded as the ultimate wellness drink because it contains nine essential nutrients (protein, Vitamin D, potassium, calcium, riboflavin, Vitamin B-12, phosphorus, Vitamin A and niacin). It protects against illnesses such as dental decay and hypertension, strengthens the immune system and contributes to healthy skin, among others. Milk should be included as an important part of a child's diet as it promotes brain development and strengthens bones. Saudi Arabia currently leads the GCC in promoting milk consumption, holding 59 per cent of the regional dairy market. Milk is a very popular drink among Saudi youth who comprise almost two third of the national population. For its part, leading dairy & food stuff firm Saudi Dairy & Foodstuff Company (Sadafco) has reached almost 90 percent of the Kingdom's schools and distributed more than a million Saudia milk packs to children as part of its ongoing educational "Saudia Champions Program" campaign on benefits of milk. "The health benefits of milk range from providing good nutrition to fighting serious chronic diseases. Milk can play a huge role in ensuring good health from youth to old age and is gaining more popularity thanks to a growing health consciousness among Saudi families. We have invested millions of Saudi riyals to raise awareness on the importance of including milk in children's diets. We have teams that visit schools and distribute milk packs along with information leaflets as part of our campaign. It is important to educate people on the health aspects of milk, which is why Saudia Milk has been launching related initiatives that particularly target young audiences," said Wael Subghah, Brand Manager, Saudia Milk. "The growth and outlook of the food sector a very important issue for the GCC countries. Although these countries are amongst the world's richest in terms of oil and gas reserves and per capita wealth, they are highly dependent on the world food markets", said Sameena Ahmad, managing director at Alpen Capital. "When it comes to food sufficiency, due to water shortage and lack of arable land, the GCC countries need to import almost 90 percent of their food requirements. Overall food consumption too will grow at a faster pace than it did over the last three years, owing to the rising incomes as well as fast growing population in the region. It is expected to expand at a CAGR of 4.6 percent over 2011-15 to 51.5 million metric tons in 2015 (as against an estimated CAGR of 4.1 percent over 2007-10). "We expect strong GDP growth and increasing per capital incomes to drive food consumption in the GCC countries", said Mahboob Murshed, managing director at Alpen Capital. "Our outlook for the sector is positive. While valuations are currently low and have been impacted by the recent economic and political crisis, we believe that there is potential for them to trend upward."
