COI\NISSION OF THE EUROPEAN COI\NUNITIES 
COM(93) 34 final 
Brussels, 5 February 1993 
REPORT FROM THE COMMISSION TO THE COUNCIL 
REPORT OH DEVELOPMEHTS OH THE 
MARKET IH MILK PRODUCTS ARD 
COMPETING PRODUCTS 
Fourth report submitted to the council by the commission 
pursuant to 
Article 4(3) of Regulation (EEC) n• 1898/87 
REPORT ON DEVELOPMENTS ON THE MARKET 
XR .NXLK PRODUCTS ARD COKPETXRG PRODUCTS 
CONTENTS 
1. Introduction 
2. The market in milk products 
3. The market in competing products 
a) products competing with butter 
l) margarine and margarine-type products 
2) reduced fat milkfat products 
3) mixed-fat products 
b) Products competing with cheese 
c) other competing products 
4. Conclusions 
ANNEXES: 
Annex I: 
Annex II: 
Annex III: 
Annex IV: consumption figures reported by Member states 
Per Capita consumption of dairy products 
Examples of competing Yellowfat Products 
Proposed Yellowfat Designations Definitions 
-2 -
DEVELOPMENTS ON THE MARKET IN HILK PRODUCTS AND COMPETING PRODUCTS 
1. INTRODUCTION 
This is the fourth commission Report submitted to the council covering 
developments on the market in milk products and competing products. 
As required under Article 4(3) of Regulation (EEC) n° 1898/87 most Member 
States have reported developments in their respective countries and this 
information forms the basis of the report. 
However, since not all reports were submitted to the commission within the 
required time limit this report is being sent to the council after the 
deadline set by Regulation (EEC) N° 1898/87. 
The report first of all analyses the market in milk products, then examines 
the market in competing products and, lastly, the conclusions to be drawn. 
-3 -
2. THE .MARKE'!' IR MILK PRODUCTS 
Because of the vast range and diversity of milk products it is more informative 
to examine the market on a product-by-product basis. 
a) Milk and Fresh Products 
b) The market for all types of liquid milk within the community has levelled 
out with stable or slightly contracting markets in all countries, with the 
exception of Germany, where growth is still occurring. 
Where the market continues to develop, however, is in the consumer trend 
away from whole fat milk to semi-skimmed milk. over the last 10 years the 
proportion whole milk sa_les in Belgium, for example, has fallen from 75 % 
to 48 % of the market share. Similarly, in the UK, whose market accounts 
for around one-third of the community's total liquid milk consumption, 
whole milk has falled from a 92 % percent market share in 1984, to 69 % in 
1990, with a consequent growth in demand for semi-skimmed milk. Indeed, 
over half the milk drunk in Denmark, the Netherlands and France is now 
semi-skimmed whilst less than a third is whole milk. 
The demand for skimmed drinking milk has not grown rapidly, however. 
overall, only 5 % of liquid milk consumed is skimmed, and even in countries 
where it is in high demand (Belgium, Denmark, Spain) the market share has 
barely exceeded 10 %. 
A consumer perception (irrespective of its scientific validity) that low­
fat products are healthier and perhaps, to a much lesser degree, price 
would explain the changes in consumer preference towards semi-skimmed milk, 
and some vitamin-enriched milks are now available for the more health­
conscious consumers. However, the relative lack of success of skimmed milk 
would seem to highlight the product's significant lack of flavour and 
texture, compared with whole milk. 
For these reasons the trend away from whole milk towards semi-skimmed milk 
(but not to skimmed milk) within a stable total liquid milk market is 
expected to continue throughout the community for the forseeable future. 
In contrast to liquid milk, the market for fresh dairy products (cream, 
yoghurt, fromage frais etc.) is expanding, though with an emphasis on low­
and reduced-fat products. Large growth in this value-added sector is 
anticipated. 
Butter 
Butter consumption within the community remained stable in 1991 after four 
consecutive years of decline which has seen consumption drop by 12 %. 
However, the downward trend is expected to recommence at around 1 % per 
year for the next two years at least. This reflects the continued growth in 
the number of other yellow-fat products which successfully compete on the 
grounds of health-image, price or convenience and are often supported by 
significant advertising campaigns. 
-4 -
Per capita butter consumption remains at around 7 kg per person for the 
· community as a whole, but with large national variations -from over 8kg in 
France to under 4kg in the united Kingdom and the Netherlands. Ireland, 
which traditionally has had one of the highest levels of butter 
consumption, currently has a per capita consumption of around only 6kg, 
even with a large social butter scheme. 
The growing number of spreadable butters and "healthy" butters (with 
reduced levels of cholesterol) on the market appears to signal the dairy 
industry's belated recognition of changed consumer values. It remains to be 
seen if such butters will be targetted at the butter market as a whole, and 
thus possibly arrest the long-term decline in butter consumption, or if 
they will remain high-price niche products, as at present. 
c) Cheese 
cheese consumption in the Community as a whole has grown by 25 % between 
1984 and 1991. In 1991 consumption increased by 2,9 % and annual growth in 
the region of 1 % per year is forecasted for the future. 
France, with 20.8 kg per person, continues to have the highest per capita 
consumption of cheese, with consumption in Germany, Greece and Italy also 
high, above 16 kg. 
In contrast, cheese consumption in Ireland averaged 5.7 kg per person in 
1990 -little more than one-quarter of that in France -whilst the UK's 
average was only a little higher, at 8.1 kg. 
-5 -
3. THE MARKET IN COMPETING PRODUCTS 
The number of products competing with milk and milk products continues to grow 
at a great pace within the conununity. In most Member States the greatest 
activity is within the yellow-fat sector, particularly with the abolition of 
national laws preventing butter/vegetable oil mixtures. 
However, in those countries with highly developed fat markets (UK, Ireland) there 
is increasing emphasis on competing products in other areas, notably cheese and 
cream. 
In general, statistics on the production and consumption of competing products 
are still difficult to obtain. The data provided by the Member states is often 
based on estimates and comparision of statistics between countries is, as a 
consequence, of limited accuracy. 
a) PRODUCTS COMPETING WITH BUTTER 
1. 
2. 
3. 
1. This group of products consists of: 
Margarine and Margarine-type products. Margarine (containing 80 % 
vegetable fat) has been the traditional competitor of butter since it was 
invented over 100 years ago. In recent years there have appeared many 
soft margarines containing polyunsaturated fats and, more recently, 
margarine-type reduced vegetable-fat products usually marketed as "Light" 
products. 
Reduced-fat milkfat products. Generally called "light-" or "reduced fat 
butter" these products contain butterfat and no other fats, but often 
contain significantly higher amounts of water than butter. 
Mixed-fat products. containing both milk-and non-milk fats it is this 
category of products that has seen the largest growth in sales over recent 
years. 
Margarine and Margarine-type Products 
Consumption of margarine and margarine-type products remains stable across 
the conununity. Where consumption has dropped this merely reflects on 
overall contraction in the yellow fats market, not a swing away from 
margarine in particular. 
There is a growing trend away from traditionnal margarine and toward "light 
margarines" (minarines) and low-fat non-dairy spreads. In Germany 
consumption of these products has gone from 23.000 tonnes to 44.000 tonnes 
in two years. In France consumption of low fat margarines have almost 
quadrupled in 2 years, from under 9.000 tonnes to over 30.000 tonnes -
whilst over the same period the consumption of "traditional" margarine has 
declined by 20.000 tonnes. 
2. -6 -
Denmark has the highest per capita consumption of margarine in the 
community -some 15kg per person -but there the trends have been reversed 
with margarine now losing market share to a high dairy content, mixed fat 
spread. 
In contrast, in the United Kingdom more new yellow fat products continue to 
appear on the market. TWo interesting new additions which fall under the 
category of margarine-type products are a 3/4 fat margarine whose chief 
ingredient is not vegetable oil or sunflower oil, but olive oil, and a 
margarine spread containing only 5 % total vegetable fat. Another, which 
contains no milkfat at all (but some buttermilk) uses the word "butter" as 
a prominent part of its name. 
Reduced-fat milkfat products 
commonly known as "light butter" these products (which include half-fat -
and threequarter fat butters) have had mixed success with consumers. 
In the united Kingdom and Ireland, where these products have faced the 
greatest competition from alternative reduced fat products for several 
years, they account for only about 2 % of the total market. 
This contrasts strongly with France and Germany: in these countries 
national legislation prohibited the development of non-dairy reduced fat 
products until recently. consequently, light butters have faced few 
competing products and have been able to gain market share from the 
•traditional' yellow fats. For example, consumption in Germany in 1990 was 
18.000 tonnes. 
It remains to be seen whether reduced-fat milkfat products can maintain a 
market share when faced with competition from reduced fat margarines and 
mixed fat products. Interestingly, in this respect light butters are the 
only "light"' dairy product not to have made a major overall impact on the 
market (unlike light yoghurt, low-fat cheese, light fromage frais, low-fat 
liquid milk etc.). 
3. Mixed-fat products 
The consumption of mixed-fat products continues to grow rapidly, with their 
spreadability and prices competitive with butter. As can be seen from 
annex III a notable feature of mixed-fat products is that it has been dairy 
companies, not margarine companies, that have developed these products, and 
many have been quick to use dairy imagery in their advertising and 
packaging. 
The oldest and largest (in volume) Community market for mixed-fat products 
is the united Kingdom. Household consumption of mixtures in 1990 totalled 
128.000 tonnes -only 3.000 tonnes less than domestic consumption of butter 
-and will have now superceded butter. 
In Ireland, where they have been on the yellow fat market since 1984, 
mixtures have a 40 % market share (almost 20.000 tonnes per annum) placing 
them ahead of margarine and butter in popularity. 
-7 -
In both the UK and Ireland mixtures have displaced butter on the market. 
In Denmark, however, the consumption of butterfat has actually risen since 
the launch of a mixed-fat product containing 60 I butterfat and 20 I 
vegetable fat. This shows that margarine, as well as butter, can be 
vulnerable to mixed-fat products in certain circumstances, and it will be 
interesting to note how the Danish market develops. 
consumption of fat mixtures in France grew from under 15.000 tonnes in 1988 
to almost 25.000 tonnes in 1990. Further growth is inevitable, not least as 
the French authorities reported that advertising expenditure on these 
products went from FF. 11.2 M to FF. 30 Mover the same period. 
The situation in Germany is less clear, since few statistics on fat 
mixtures are available. However, it appears that these products have made 
a smaller-than-expected initial impact on the German market, due to the 
German consumer's preference for natural and traditional products. 
In most, if not all of the other Member states fat mixtures are now on the 
market but there are no figures on sales available. 
b) -8 -
PRODUCTS COKPETIRG WXTB CHEESE 
Products competing with cheese were originally to be found in the sector of 
industrial food ingredients, particular for use as pizza toppings, and use 
casein in their manufacturing process. In the last couple of years, 
however, the number of cheese imitations appearing on supermarket shelves 
has grown considerably. 
unlike those in the ingredients sector, cheese imitations for retail sale 
are generally made and matured in the same way as cheese but contain 
sunflower or vegetable oil in replacement of some of the butterfat. 
statistics on the consumption of cheese imitations are very limited with 
only one Member state (France) supplying significant details. These showed 
that in 1990 consumption of imitation cheeses totalled 3.000 t -a 200 % 
increase on the previous year. 
However, \le do know that these products are now available in several other 
Member states, notably the Netherlands, Belgium, Germany and the united 
Kingdom. The Netherlands is the chief producer of imitation cheeses, with 
production totalling 3.000 tonnes in 1990, much of it for export. The two 
major brands contain 80 % sunflower oil and 20 % butterfat, and 54 % 
vegetable fat and no milkfat content, respectively. 
cheese-type products made from soya also exist, though their appeal is very 
limited and seldom seek to imitate cheese. 
c) OTHER COKPETXRG PRODUCTS 
In the liquid milk sector competing products exist in the form of soya 
juice or filled milk. 
soya juice, or tonyu, is derived exclusively from soya beans and is of very 
minor importance in most Member states. An exception is in France where 
almost 10.000 tonnes of soya drinks were consumed in 1990, whilst sales in 
Germany totalled 3.500 tonnes. In the U.K. and Ireland soya juice is sold 
as "soya milk", an apparent breach of Regulation N° 1898/87.* 
Filled milks, where the fat in milk is replaced by vegatable fat, but the 
protein and carbohydrates are of dairy origin, are found in Southern 
Europe. In Spain, consumption totals 30.000 tonnes per year with much 
going to the Canary Islands. 
Products competing with condensed milk include coffee whiteners, which have 
a 20 % market share in the Netherlands. cream substitutes for dessert 
toppings are generally mixed fat products and are increasing in number on 
the market, reflecting the negative health images associated with cream. 
* a) proceedings have been issued against the UK for breaching article 3 (1) 
(on 8/10/92) 
b) the Irish authorities were asked to clarify their position with regard to 
the sale of soya milk in Ireland (letter 6/10/92). 
-9 -
4. CONCLUSIONS 
The trends seen in this report in the market in milk products and competing 
products do not differ greatly from those seen in the previous reports submitted 
to the council, namely: 
stable consumption of liquid milk, though with a continuing shift away from 
full-fat milks to reduced-fat milks, 
growth in the consumption of fresh products, with particular emphasis on 
reduced-fat products, 
continued steady growth in the consumption of cheese, 
a gradually contracting yellow fats market, in which margarine is retaining 
its market share, 
a continued drop in household consumption of butter, 
significant growth in the consumption of reduced-fat and mixed fat 
products, often containing only a low dairy content. 
It can be said that products competing with butter are now in the dominant 
position in the yellow-fats market. 
Yet, in spite of the growth in the number of competing products the Member states 
appear to have little or no information on them -either in terms of the 
formulation of products, or in terms of volumes of consumption. The absence of 
such information makes it very difficult to manage effectively the butterfat 
market. A legal basis for statistics on these products is thus urgently needed, 
in order that the necessary information can be acquired. 
A council regulation laying down designations for yellow fats will assist in 
informing the consumer about genuine dairy products and therefore should result 
in either keeping certain markets or regaining markets lost due to 
misinformation. 
For the same reason the growth in the market for non-dairy imitation cheeses and 
creams needs to be closely followed. 
If it appears that consumers are confused by the packaging and comparative 
advertising of these products, one could consider strengthening Council 
Regulation (EEC) No 1898/87 by the addition of legal definitions for dairy 
products to prevent the misuse of dairy imagery. 
RM/sb (0197) 
ANNEX I 
CONSUMPTION FIGURES REPORTED BY MEMBER STATES 
BUTTER CONSUMPTION 
> 80% FAT <80% FAT 
(000't) 1988 1989 1990 1988 1989 1990 
Belgium 84.8 78.5 76.9 Yes 
Denmark 55.8 51.9 49.0 4.1 17.8 18.4 
Germany 506.3 449.9 404.1 
Greece 
Spain 21.8 19.0 
France 490.0 477. 0 474.0 2.9 5.2 6.7 
Ireland 16.3 13.2 12.2 2.7 1.9 1.6 
Italy 
Luxembourg 2.7 2.6 2.4 
Netherlands 56.0 51.0 52.0 0 0 0 
Portugal 11.6 12.7 12.9 
united Kingdom 275.0 215.0 220.0 
SOURCE: Member State replies to commission, under Reg 1898/87. 
MARGARINE CONSUMPTION 
> 80% FAT < 80% FAT 
(0001t) 1988 1989 1990 1988 1989 1990 
BELGIUM 130. 9 128.5 125.6 
DENMARK 72.6 71.6 69.5 4.7 5.5 5.3 
GERMANY 441.2 444.1 477. 7 23.9 30.0 44.6 
GREECE 
SPAIN 
FRANCE 121. 81 111.5 97.2 9.0 16.9 30.9 
IRELAND 15.2 15.7 15.1 
ITALY 
LUXEMBOURG 3.1 3.1 3.0 
NETHERLANDS 157.0 148.0 146.0 37 42 43 
PORTUGAL 59.4 60.0 62.6 
UNITED KINGDOM 389.0 379.0 379.0 
SOURCE: Member state replies to commission, under Reg 1898/87. 
RM/sb (0197) 
MIXED FATS CONSUMPTION CHEESE CONSUMPTION 
(000't) 1988 1989 1990 1988 1989 1990 
BELGIUM Yes 125.8 134.6 142.3 
DENMARK 0 0 3.3 
GERMANY 984.8 1034.3 1074.9 
GREECE 
SPAIN 
FRANCE 14.7 20.7 24.9 
IRELAND 15.0 17.5 18.9 17.8 18.6 19.1 
ITALY 
LUXEMBOURG 0.4 0.4 0.4 6.1 6.0 6.6 
NETHERLANDS 0 0 0 201.0 211. 0 215.0 
PORTUGAL 40.5 44.7 44.2 
UNITED KINGDOM 124.0 141.0 144. 0 395.0 390.0 390.0 
SOURCE: Member state replies to commission, under Reg 1898/87. 
BELGIUM 
DENMARK 
GERMANY 
GREECE 
SPAIN 
FRANCE 
IRELAND 
ITALY 
LUXEMBOURG 
NETHERLANDS 
PORTUGAL 
UNITED KINGDOM 
SOURCES: F.A.O., \L RM/sb (0197) 
ANNEX II 
ESTIMATED CONSUMPTION OF DAIRY PRODUCTS, 1990 
(kg per head) 
Butter Margarine cheese Liquid Milk Fresh Products 
7.6 12.5 14.3 69.5 17.0 
6.0 15.0 14.6 122.6 21.6 
6.6 7.9 18.6 70.7 20.9 
17.8 
0.5 5.3 102.6 12.5 
8.2 3.9 20.8 79.5 22.7 
6.1 4.6 5.7 184.6 3.4 
2.4 1.6 16.9 78.1 3.8 
6.8 11.3 76.9 9.1 
3.3 9.8 15.0 93.0 42.0 
0.9 5.4 
3.8 6.6 8.1 122.5 5.1 
I.D.F 
\~ RM/sb (0197) 
ANNEX III 
COMPETING YELLOWFAT PRODUCTS -SOME EXAMPLES 
Product Name 
Candia 
Balade 60 
President Light 
Natual 
Balade 
Buttercup 
Butterfly 
Dawn Light 
Les Nouveaux Plaisirs 
Du Darfst 
Bredel Beurre Allege 
Silhouette 20% 
Kaergaarden 
Butina 
Clover 
Golden crown 
Dairy gold 
Florefin 
Le Fleurier Allege 
Lifestyle 
Avorunore Light 
St Hubert 41 
Elmer Light 
Clover Extra Lite 
I can't Believe It's 
Not Butter 
Krona Spreadable 
Olivio 
Avonmore Xtra Light 
Effi 
St Ivel Gold 
Lowlow 
Anchor Low-Fat Spread 
Golden Olive 
St Ivel Gold Lowest 
Delight Extra Low 
Twenty Four 
Tesco Lowest Ever Spread Milkfat/Total fat 
content (in%) 
65/65 
60/60 
62/62 
60/60 
41/41 
40/40 
40/40 
40/40 
41/41 
40/40 
41/41 
20/20 
60/80 
50/70 
50/70 
15/72 
30/75 
50/62 
20/60 
40?/60 
15/40 
34/41 
25/40 
25?/40 
0/70 
0/70 
0/60 
0/40 
0/40 
0/40 
0/40 
0/40 
0/40 
0/25 
0/20 
0/20 
0/ 5 Manufacturer 
Sodiaal, F 
ULN, F 
Besnier, F 
Entremont, F 
Corman, B 
Mitchelstown, IRL 
Meggle, D 
Kerry, IRL 
Elle & Vire, F 
Unilever, D 
Bridel, F 
Sodiaal, F 
MD Foods, DK 
Uelzina, D 
Dairy Crest, GB 
Kraft, UK 
Mitchelstown, IRL 
Corman, B 
Vedial, F 
Avonmore, IRL 
Avonmore, IRL 
St Hubert, F 
Elmer, NL 
Dairy, crest, UK 
vandenBergh, UK 
VandenBergh, UK 
Vandenbergh, UK 
Avonmore, IRL 
Astra Calve, F 
unigate, UK 
Kerry, IRL 
Anchor, UK 
Golden vale, IRL 
unigate, UK 
vandenBergh, UK 
Brinkers, NL 
Kerry, IRL Product Typel) 
Dairy spread 
Fat-reduced butter 
Fat-reduced butter 
Fat-reduced butter 
Low-fat butter 
Low-fat butter 
Low-fat butter 
Low-fat butter 
Low-fat butter 
Low-fat butter 
Low-fat butter 
Low-fat dairy spread 
Blend 
Blended spread 
Blended spread 
Blended spread 
Blended spread 
Fat-reduced blend 
Reduced fat blended 
spread 
Reduced fat blended 
spread 
low-fat blend 
Low-fat blend 
Low-fat blend 
Low-fat blend 
Fat spread 
Fat spread 
Fat-reduced 
margarine 
Low-fat margarine 
Low-fat margarine 
Low-fat margarine 
Low-fat margarine 
Low-fat margarine 
Low fat margarine 
Low-fat spread 
Low-fat spread 
Low-fat spread 
No designation 
1) Definitions, as currently proposed for Council Regulation. See Annex IV. 
RM/sb (0197) 
ANREXJ:V 
PROPOSED YELLOW-FATS DESIGNATION GRID 
This is the current proposal for the forthcoming council Regulation aimed at laying 
down marketing standards for yellow fat products. At the time of writing the 
proposals had yet to be approved. 
95% 
I 
80% 
II 
62% 
60% 
41% 
III 
39% 
20% Butter 
Dairy Spread 
Fat-reduced or 
3/4 fat butter 
Reduced fat 
dairy spread Blend 
Blended spread 
Fat-reduced or 
3/4 fat blend 
Reduced fat 
blended spread Margarine 
Fat spread 
Fat-reduced or 
3/4 fat 
margarine 
Reduced fat I 
spread I ----------- ---------- ___________ ! 
Low-fat or 
half-fat butter Low-fat or 
half-fat blend I 
Low-fat or I 
half-fat margarine! ----------- ----------- ___________ ! 
Low-fat dairy 
spread Low-fat blended 
spread I 
Low fat spread I 
I ----------- ---------- ___________ ! 
SOURCE: Council document COM (91) 462 final, 22/1/92 

\~ 
ISSN 0254-1475 
COM(93) 34 final 
DOCUMENTS 
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Catalogue number: CB-CO-93-037-EN-C 
Office for Official Publications of the European Communities 
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