One challenge for directors of dairy co-operatives in an increasingly globalised market is to have an understanding of the likely future structure and operation of global dairy markets.  Such an understanding permits directors to make a more informed input at board level when it comes to approving the future strategic direction of their co-operative.

The Global Dairy Platform (GDP) is an international organisation that provides direction to the dairy industry.  It connects various industry stake holders in a forum designed to assist them collaborate on worldwide dairy issues at a pre-competitive level. GDP is focused on expanding global demand for milk and dairy products through a more co-ordinated effort across regions to promote the dairy industry.

Part of a recent international workshop organised by GDP focused on “The Future of Dairy Marketing”.  The workshop was based upon a strategic scenario planning exercise undertaken with SAMI Consulting, a UK based futurist think-tank. At the workshop attendees sought to develop an understanding of how global trends may affect dairy’s role in food and nutrition security.

Some of the facts and insights that emerged from the workshop were as follows:

• By 2035 we will have a world with an increasing population (estimated at 8 billion), with increasing expectations, less supply & more demand
• Most of the additional growth will be in Africa and in South and South East Asia
• The percentage of the population living in cities will approach 70 percent
• By 2035, 25 of the 50 biggest cities will be in Asia, 10 in Africa and the western business model may no longer dominate
• The new centres of power may not share the value or governance systems of the West
• There may be a move from western to global trends and global role models
• The rapidly emerging middle class will demand higher quality (for example, animal proteins)
• There will be an even greater need to be proactive on food security and sustainability
• There will be increasing demand for transparency along the supply chain
• The world is moving to more choice for more people
• Rapidly developing  new technology is affecting people and their lifestyles, farming and food production, manufacturing and supply, etc
• Information is increasingly personalised and marketers’ are using our electronic footprint (Facebook, twitter, google) to position their offerings
• The extended age range of people making buying choices means that the food industry need to understand the mind-set of the next generation as well as changing needs of the older population
• Technology (info, cogno, bio, nano) will continue to introduce changes in personal capacity and lifestyles, with information and communication technologies underpinning much of society as well as commerce, with universal ownership of electronic devices
• Ecological, energy and environmental systemic limits will be tested or breached as the population increases

Against this background SAMI, posited that National markets were becoming less important as determinants of behaviour, with different consumer groupings beginning to emerge across national boundaries. One societal development, they argued could be the emergence of Affinity Groups.  In this scenario, people with many different cultures (Affinity Groups) live next to each other, but base their behaviour on the rules of the Affinity Group not the nation state.  The other scenario, City Society, describes a society in which a city and its hinterland are dominated by a single culture which determines the brand of the city region. Trading and investment is centred on the city and its catchment area.

While the Scenarios proposed and the insights given by SAMI are of their nature speculative, they do serve as one useful tool for co-operative directors and executives to help inform them as to the longer term structural and operational choices they need to make to ensure a sustainable and competitive co-operative in the future.