The world’s biggest dairy companies experienced a significant slowdown in their growth last year, according to Rabobank’s latest Global Dairy Top 20.

The report found the top 20 posted combined dairy sales of $223bn/€167bn in 2014, up 5% year on year.

However, retail dairy price inflation was running at 4% to 5% in key markets, meaning adjusted growth was “very weak”, said Rabobank.

It attributed the poor growth to three factors – slow economies and high pricing in EU, US and Chinese dairy markets; depreciation of emerging market currencies; and a scarcity of large acquisitions or mergers by the top 20 in the past 18 months.

The latest Top 20 ranking, which is based on dairy turnover in 2014, saw a changing of the guard in terms of the biggest players, with Nestlé retaining its top spot but Lactalis moving ahead of Danone into second place for the first time.

Dairy Farmers of America was the first new entrant into the top five for eight years, displacing Dutch FrieslandCampina.

Unilever dropped one place to 12, while Arla stayed put at seven and Müller dropped two places to 20.

Looking ahead, Rabobank said the dairy industry was blessed with “positive fundamentals” that should continue to ensure growth in coming years – including population growth, urbanisation and dietary shifts in emerging markets.

However, it warned the rate of growth in the global industry was “no longer what it was a decade ago” and profitability was becoming “more challenging”.

It gave China as an example, pointing out companies that had enjoyed a “remarkable rise” up the ranks of the world’s largest dairy companies over the past decade were now facing a “new reality” as a result of slower economic growth and the maturation of several product categories in the home market.

The report also warned that the decline of Japanese companies, which have “slid significantly down the list” in the past few years, provided a “cautionary tale” for the rest of the industry.

“When faced with a slow-growing domestic market, it is hard to expand a dairy business without pushing into offshore markets, or acquiring and integrating other companies,” it said. “A weakening currency only serves to further devalue sales.”

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