UHT Milk and Cheese Reveal China's Evolving Dairy Landscape in Q1 2024

Executive Summary

China's online dairy market in Q1 2024 tells two contrasting stories ^[1]. The UHT milk segment remains a concentrated duopoly where Yili (伊利) and Mengniu (蒙牛) claim 8 of the top 10 product positions, with Yili Jindian Pure Milk surging +89.7% YoY. The cheese segment, by contrast, is a fragmented battleground where regional specialty brands like Western Queen and imported players like Anchor carve out fast-growing niches. Channel preferences differ sharply between the two categories, and the data suggests that success strategies must be tailored to each product type rather than applied uniformly across dairy.

UHT Milk: A Concentrated Market with Clear Channel Preferences

UHT milk demonstrates a more balanced channel distribution than milk powder, with three platforms collectively commanding over 58% of revenue. Douyin (抖音) leads at 22.1%, followed by JD.com (京东) Domestic Self-Operated at 20.2% and Tmall (天猫) Supermarket at 16.3%.

Q1 2024 Online UHT Milk Channel Distribution by Share

This channel concentration reflects UHT milk's characteristics as a high-volume, logistics-intensive product. Tmall Supermarket's 16.3% share in UHT milk (versus just 2.1% in milk powder) underscores how liquid dairy's bulk-purchase nature suits supermarket channel mechanics. JD.com Domestic Self-Operated's 20.2% share similarly reflects the platform's logistics advantage for heavy, perishable goods.

Cross-border channels are negligible for UHT milk: JD.com Overseas POP (0.17%), JD.com Overseas Self-Operated (0.24%), and Tmall Global (0.21%) together account for less than 1%. Domestic production and logistics dominate the category, presenting a structural barrier for imported brands seeking online distribution without establishing local fulfillment operations.

The Yili-Mengniu Duopoly Tightens Its Grip

The top 10 UHT milk products by sales revenue confirm the competitive duopoly's dominance. Mengniu holds 5 positions and Yili claims 3, with only Adopt A Cow and Oriental Selection breaking through.

Mengniu Terensu Pure Milk (250ml x 16 boxes) leads at CN¥ 168.9 million in sales revenue with +38.4% YoY growth. Yili Jindian Pure Milk follows at CN¥ 144.2 million with the highest YoY growth among established products at +89.7%, demonstrating the effectiveness of Yili's whole-case value proposition.

Two dynamics stand out from the rankings. First, the premium tier shows strong growth: Mengniu Terensu Organic (CN¥ 126.40 per unit, +106.7% YoY) and Oriental Selection Desert Pure Milk (CN¥ 88.28, new product with +200.6% quarter-on-quarter growth) both outperform lower-priced alternatives. Second, JD.com dominates the top 10 with 8 of 10 positions, reflecting the platform's strength in repeat-purchase, logistics-heavy dairy categories.

Oriental Selection's entry at the CN¥ 88.28 price point --- nearly double the average UHT milk price --- demonstrates that content-driven platforms can command premium pricing when product storytelling resonates with consumers. The brand's desert-origin provenance narrative translated directly into purchasing behavior on Douyin.

Cheese: A Fragmented Market Ripe for Disruption

The online cheese segment presents a starkly different competitive picture. China's cheese consumption per capita remains below 0.3 kg annually, compared to over 15 kg in Europe, signaling substantial room for growth ^[2]. Channel shares cluster tightly, with JD.com Domestic Self-Operated at 1.4%, Douyin at 1.3%, and Taobao (淘宝) at 0.9%. This fragmentation reflects cheese's nature as a discovery-driven purchase where browsing platforms compete effectively with logistics-focused channels.

Q1 2024 Online Cheese Channel Distribution by Share

The cheese category's smaller absolute scale --- shares in low single digits compared to UHT milk's higher proportions --- reflects its still-emerging status in China's dairy consumption landscape. Cross-border channels are effectively non-existent for cheese, with Tmall Global at 0.007% and JD.com Overseas Self-Operated at 0.000%.

Three Competitive Clusters Emerge in Cheese

The top 10 cheese products reveal three distinct competitive clusters that define the category's current landscape.

Regional specialty brands dominate Douyin. Western Queen leads with three Xinjiang-origin products (milk curd yogurt stick, prebiotic cheese block, camel milk curd) collectively generating CN¥ 21.7 million in sales revenue. The brand leverages regional provenance and Douyin's content-discovery format to reach consumers seeking authentic, origin-driven dairy products.

Children's cheese sticks face competitive pressure. Milkground maintains category leadership with three SKUs across JD.com and Douyin, but its original-flavor product on JD.com declined -19.3% YoY, signaling that the established children's segment is maturing. Yili's Jinhu 4 Zero-Additive Cheese Stick posted an extraordinary +2,857% YoY growth, though a -56.0% quarter-on-quarter decline suggests the figure was amplified by promotional activity rather than sustained organic demand.

Imported brands find traction on JD.com. Anchor (New Zealand) holds two positions with imported mozzarella shredded cheese and light cream, both marked as new products with extraordinary quarter-on-quarter growth (+696.1% and +620.8%, respectively). These results demonstrate that imported cheese brands can achieve top-10 penetration through JD.com's Self-Operated channel.

The pricing spectrum ranges from CN¥ 31.34 (Western Queen yogurt stick) to CN¥ 148.56 (Milkground Paw Patrol assortment), indicating that both value-oriented regional products and premium branded children's cheese successfully coexist in the market.

Key Takeaways

• UHT milk remains a duopoly: Yili and Mengniu hold 8 of the top 10 positions, with Yili Jindian's +89.7% YoY growth demonstrating that whole-case value packaging drives volume in mature categories.
• Channel strategies must differ by product type: UHT milk concentrates on JD.com Self-Operated and Tmall Supermarket for logistics efficiency, while cheese discovery relies on Douyin and Taobao.
• Premium UHT milk outpaces the mass market: Mengniu Terensu Organic (+106.7% YoY) and Oriental Selection Desert Pure Milk (CN¥ 88.28, new) confirm the premiumization trend extends beyond milk powder.
• Cheese is China's dairy frontier: Small absolute scale but high fragmentation creates openings for brands with strong provenance narratives (Western Queen's Xinjiang origin) or imported quality signals (Anchor's New Zealand positioning).
• Cross-border channels remain negligible for liquid dairy and cheese, reinforcing the need for domestic fulfillment operations to access high-volume channels.

About the Data

This analysis draws on Moojing Market Intelligence's proprietary e-commerce tracking data, covering SKU-level sales revenue, volume, and pricing across Tmall, Taobao, JD.com, and Douyin for Q1 2024 (January--March 2024). Data is aggregated from daily transaction-level records and reported at the monthly and quarterly level. For the complete dataset including milk powder market analysis, sub-category breakdowns, and best-selling product intelligence, download the full report.

Data source: Moojing Market Intelligence