Industry hit by reliance on overseas and inadequate domestic supply

China's imported dairy products will exceed 20 percent growth in 2014 as continued urbanization pushes up demand and a lack of large dairy farms limits supply, a bank report said on Tuesday.

The number of domestic manufacturers will increase to make up 30 percent of the country's raw milk supply in 2016, a rise from less than 20 percent this year, according to a study by Rabobank Nederland.