North American volume declined 1.9% versus 0.3% growth in 2007, according to the firm's Dairy Drinks Service. Last year marked the first absolute decline in demand within North America (as well as Western Europe, down 0.4%) since 2004.

The economy contributed to slowed growth worldwide. However, Asia -- which now accounts for 45.2% of all global demand -- saw the most dramatic slowing (down to 0.5% growth versus 5.1% in 2007), largely due to lingering effects from the region's melamine scandal, according to Canadean.

Growth of white milk, which accounts for 79.4% of global dairy drink demand, dropped from 0.6% to 0.3% last year. Value-added drinking yogurts, flavored and fermented milks have been the fastest-growing categories since 2002 worldwide, but these saw the sharpest drop last year (-2.9%) -- again as a result of the Asian melamine after-effects.

Categories that continued to show growth included soy-based drinks; evaporated, condensed, low-fat, ESL, organic and fortified milks; and probiotics.

In 2009, the dairy drinks market will see intensified competition and extensions of new products, brands and packaging types geared to more cost-conscious consumers, Canadean reports.--Karlene Lukovitz

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