Austrade and Dairy Australia: Growing dairy exports to Southeast Asia

Asia accounts for around 87% of Australia’s dairy exports, and Southeast Asia is the fastest-growing regional market. The region imported over 290,000 tonnes of dairy products, valued at over A$1.2 billion in FY2023–24. Singapore, Indonesia and Malaysia were among the top 5 export destinations. (Source: Dairy Australia, Australian dairy industry in focus 2024).

Those results are gratifying to Dairy Australia. The national services body for the Australian dairy industry has spent the past decade developing strong relationships with customers in Southeast Asia in collaboration with Austrade.

‘Dairy is seen as a natural and healthy product in Southeast Asia,’ says Bronwyn Duke, Dairy Australia’s International Market Manager. ‘International travel and deeper connections between Australia and the region are helping fuel demand.’

Vietnam’s taste for high-value dairy products

Vietnam is becoming an important market for premium dairy produce. It is Australia’s eighth largest market by volume and growing. Products like frozen milk concentrate, cheeses and cultured dairy products are proving popular, thanks to uptake by the Vietnamese hospitality sector. International tourists and returning students from Australia are also driving demand for premium dairy products.

Trusted reputation for quality and safety

Australia’s reputation as a safe, reliable supplier of high-quality dairy is a major advantage in a market that’s had to deal with sub-par and fake products. Vietnamese authorities recently uncovered a criminal operation involving over 573 counterfeit milk products, prompting the Vietnamese Government to tighten regulation.

‘People trust imported products more because of these incidents,’ says Duke. ‘The “Manufactured in Australia” label is a big drawcard for consumers, retailers, manufacturers and the hospitality sector.’ 

Australia’s diverse production system can be another competitive advantage. This lends itself to a bespoke supply partnership. ‘Our producers are more likely to be able to take on a smaller contract and work with a partner to tailor a product for them,’ says Duke.

Austrade’s on-the-ground support

Austrade’s support for Dairy Australia’s market development work over the past decade has been valuable in growing Australian dairy exports to Southeast Asia.

Duke says Austrade’s deep market knowledge and local connections are essential for building and maintaining ongoing connections with customers.

‘Dairy Australia’s programs focus on building strategic, long-term relationships in Southeast Asia, and Austrade’s on-the-ground presence helps maintain the connections,’ says Duke. ‘Dairy Australia’s regular, in-market events and initiatives provide opportunities for us to work side-by-side with Austrade and optimise outcomes.’

Austrade and Dairy Australia have delivered events, education, tastings and introductions to grow dairy exports in Vietnam and across Southeast Asia.

‘The Austrade partnership with Dairy Australia is built on years of support, cooperation and collaboration,’ says Chris Morley, Austrade Trade Commissioner. ‘By working with the industry body, we build a greater connection with exporters, leverage each other’s networks and experience – and ultimately ensure improved outcomes for our clients and customers.

‘We look forward to continuing to work with Dairy Australia and the dairy industry on further market expansion in Vietnam and the Southeast Asia region.’

A higher-quality, more affordable product

The Austrade-Dairy Australia partnership has had many successful outcomes, including for Ali Waugh, an Australian business-owner living in Hanoi. She owns the Eastern and Oriental Tea House and Coffee Parlour, the Slavic Tea House, and the Eastern Oriental Express bakery. The 3 businesses use up to 1,000 kg of cream cheese and 1,600–2,000 kg of whipping cream each month.

Waugh was sourcing the cream cheese from New Zealand. After experiencing 3 steep price hikes, she was considering changing suppliers. Austrade introduced her to Duke, who was visiting Hanoi. ‘Bronwyn was a wealth of information,’ says Waugh. ‘She knew which Vietnamese distributors carried which Aussie dairy products, and connected me to suppliers I wanted to meet.’

‘Bronwyn and Chris Morley also invited my purchasing manager to a trade event at the embassy, where she met the relevant companies and set up meetings. Within 4 weeks, we had ordered our first shipment of Burra cream cheese and signed a contract with Fobe, the distributor.

‘Changing from New Zealand to Aussie cream cheese has been one of the smartest business decisions we have made,’ says Waugh. ‘The price is significantly lower, and we did not have to raise the price of our cakes.’

Before making the change, Waugh asked the baking team to take a blind taste test. ‘All 8 bakers felt the Aussie product had a superior taste. The Aussie cream cheese is also softer than the New Zealand product. This has had 2 unexpected benefits: it is quicker to prepare cheesecake batter and cake frosting, so productivity is higher. We’ve also had fewer mixing machines break.’

Australian cream cheese is more affordable, has a superior taste and is easier to work with, according to business-owner Ali Waugh.

Cultivating long-term opportunities for dairy producers

In an increasingly volatile international trade environment, Dairy Australia is seeking more higher-value opportunities for Australian dairy producers. That means creating deeper connections with customers looking for premium and value-add products.

One of the ways in which Dairy Australia creates personal connections is through its scholarship program. The program brings 12–15 key market contacts a year to Australia to visit dairy farms and processing facilities and meet Australia’s dairy producers. This immersive technical experience creates a preference for Australian dairy and underpins future business.

Ongoing alumni events and seminars help customers stay up to date. These also provide opportunities to extend connections to new customers. Referrals from existing customers are an important source of new business.

‘Our deep connections in-market provide a vital source of information and insights for the Australian dairy industry,’ says Duke.