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Goat Milk Market Still in Infancy

Goat Milk Market Still in Infancy

Author: Pavel Malyshev, Expert in Marketing and Business Planning in the Agriconsult Group of Companies


In Russia the volume of production of raw goat milk accounts to about 400 thousand tons per year. Having said that, the market of processed packaged goat milk still finds itself in its infancy. Its market size only totals to about 2-2.5 thousand tons per year, i.e. less than 1% of the wholemilk and milk products market. The market cannot be called a highly competitive one as the share of the top three players accounts for about 80%.

Current Condition of Goat Breeding Industry

Over the past few years, the number of livestock of goats in Russia varies between 2.1 and 2.3 million (See Chart 1).


Chart 1.Goat population dynamics in Russia within all categories of enterprise (in thousands of heads).


Source: FederalState Statistics Service of the Russian Federation


In the overall structure of goat population, about 79% fall within public enterprises, about 11% - within farm enterprises meanwhile only 10% is accounted for agricultural organizations. Having said that, according to expert evaluation, the population of dairy goat breeds in all categories accounts to about 300 thousand heads.

Конференция Масложировая индустрия 2016



The current state of affairs can be explained by the fact that, until recently,industrial production and processing of goat milk were missing in Russia. According to the experts of Russian State Agrarian University-MTAA, there are now in the country not more than 10 farms with livestock over than 1 thousand goats all in all (the number of milch cattle is much smaller). The list of some of the largest Russian goat breeding enterprises is given in Table 1. More information indicating the livestock of milch cattle is presented in the report on the goat milk market research conducted by the Agriconsult Group of Companies.


Table 1. The largest goat breeding farms of the Russian Federation








Krasnaya Niva



OOO* Pure Line Product




Mariy-El Region

ZAO** Sernur Cheese Factory







ZAO Herd-breeding Farm Prinevskoye






ZAO Herd-breeding Farm Krasnoozernoye



Republicof Mordovia

OOO Tavla



*OOO - Limited Liability Company

**ZAO - Closed Joint-Stock Company


Source: Companies and market experts’ data.


Even if only relying upon the livestock of dairy goats (300 thousand) and average milk yield from one dairy goat - 500-1000 L/year, the market of raw goat milk makes not less than 200 thousand tons per year. FAO (Food and Agriculture Organization of the UN) estimates the annual production in Russia at 400 thousand tons.


However, the bulk of this milk is produced for own consumption meanwhile sales in its raw form, including outside the official trade (peddling), are meant for feeding kids. Thus, only a small fraction is actually intended for processing.  It is worth noting that unlike cow milk, the implementation of which in its raw form is severely restricted, goat milk is allowed for sale without preliminary heat treatment. Meanwhile the only prerequisite is the farm’s encephalitis-free status.



Current Condition of Packaged Goat Milk Market


In the structure of the dairy market of Russia bottled goat milk and its products account for less than 1%. As a comparison - in some European countries such as France, Greece, Italy, Spain and the Netherlands, the share reaches 15-20% of total sales.

Although the absolute size of the market of packaged goat milk is at this stage relatively small (about 2-2.5 tones in 2009), the market is growing quite rapidly. Thus, the annual growth in 2000-2008 was recorded at 20-30%. And whereas in 2009, there was a slight reduction in the market due to financial crisis, experts predict an increase in sales judging by 2010 in review.

Over the recent years, the import of goat milk has reduced. In 2007, the import value amounted to about 400 tons, in 2009 - only 180 tons. The volume of export products is extremely low.

According to experts, in terms of geography at least 60-70% of sales falls within Moscow and St. Petersburg.

The largest volume of sales belongs to the Russian Milk Company (former Ekmol, the brand ‘Margareta’) - about 40% in kind. The second place is taken by the Pure Line Company with the same name brand. According to experts, its market share is steadily increasing over the past few years. The top three are rounded out by the only foreign player in the Russian market – the Lactalis International Company, France (the brand name ‘President’).

All mentioned companies are players of the federal level. Two prospective market participants, whose sales are more local in nature, should be noted as well. These are the Sernur Cheese Factory (trade mark ‘Useful Products’) and the herd-breeding farm Prinevskoye (the brand ‘Prinevskoye’). While competing with market leaders rather successfully, they are engaged in the supply of pasteurized milk with a short shelf life to the markets of Moscow (the Sernur Cheese Factory) and St. Petersburg (‘Prinevskoye’).



Retail Sales Condition


In November 2010, the specialists of the Agriconsult Group of Companies conducted an audit of the retail chains in Moscow and St. Petersburg. According to the results, bottled goat milk is present in the market in the form of whole milk and dairy drinks reconstituted from dry milk.

Depending on the method of processing there are pasteurized (shelf life of 5-13 days), ultra-pasteurized (shelf life of 3.5 months) and UHT milk (shelf life of 6 months). Manufacturers offer goat milk with various fat content (from 1 to 8.9%) and in packages of various sizes (from 0.2 to 1 L) and types (Tetra-Pak, Pure-Pak, plastic PET bottles, glass bottles).

Meanwhile manufacturers’ wholesale prices range from 70 rubles/L, the retail prices vary between 120 rubles/L and 250 rubles / L in Moscow and 100-230 rubles / L in St. Petersburg.


Both in the capital and in the city on the Neva river, goat milk is most widely presented in the premium class supermarkets and hypermarkets. There is also a certain offering in the supermarkets of medium price category. In the vast majority of chain discount stores and convenience stores, goat milk is either not presented at all or presented in a limited range.Online stores with door-to-door delivery, pharmacies and baby-goods stores can be mentioned among other retail channels for goat milk implementation.


Development Prospects


Further development of the market largely depends on the development of the culture of goat milk consumption, as well as on the population welfare. For instance, according to unofficial statistics, 2/3 of Russians have never tasted goat milk!

Meanwhile, the interest in this product has experienced significant growth over the recent years. The main factors influencing the growth of goat milk market are:



  • Increased interest in a healthy lifestyle. Goat milk contains 6 times more cobalt, more vitamins A, B2 and C when compared to cow milk. In addition, it is digested better (97% vs. 65%) and faster (5 times) than cow milk.


  •  About one third of Russia's population are allergic to cow milk. Meanwhile goat milk is practically 100% hypoallergenic.


  • The emerged interest in goat milk as baby food. According to doctors, it is principally a substitute for mother’s milk.



Also, there are several factors that hinder market development. The chief ones among them are:


  • extremely small number of highly productive breeds of dairy goats
  • lack of specialized facilities for processing goat milk
  • undeveloped culture of consumption
  • high cost of production due to lower productivity (compared to dairy cattle breeding), high-cost    production and low level of competition;
  • lack of government support.


However, whereas the prime cost of goat milk is about 2.5 times higher than that of cow milk, the price of its implementation is 3-5 times higher. This fact, coupled with the relatively low level of competition, makes the industry rather attractive for investors.


According to the suppliers of goat breeding equipment, such as Westphalia, Max-AGRO, Sozidaniye, large-scale projects (1 000 heads and above) are currently underway in the Krasnoyarsk Territory, Krasnodar Territory, and Pskov Region, as well as a farm project in the Lipetsk region. Also at issue is the possibility of creating a megafarm with livestock up to 5 thousand units in the Tyumen, Penza, and Nizhny Novgorod regions, and smaller farms in the Kaluga and Tyumen regions and Stavropol Territory. Interest in the development of goat breeding is also shown by entrepreneurs from the Urals, and some republics of the Southern Federal District.


Significant potential of production capacity is also possessed by some of the active players’ farms  including the Sernur Cheese Factory and the herd-breeding farm ‘Prinevskoye’. Thus, both the balance of power in Russia’s goat milk market, and the industry condition might change significantly in the next few years.


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