SOFT drink maker Coca Cola Amatil will take on South Australian favourite Farmers Union Iced Coffee in September with the launch of its own coffee-flavoured milk.

Farmer's Union Iced Coffee, which achieved "iconic status" in 2006, out-sells Coke in SA by almost three to one – the only place where a milk drink is more popular than a cola.

CCAmatil chief executive Terry Davis said testing of Goulburn Valley flavoured milks in WA had gone very well in the past 10 months.

SA's launch date for the milks, which include banana, strawberry, chocolate, iced coffee and mocha flavours, is set for September 18 with a national roll-out to follow.

SA region manager and former Glenelg SANFL player Peter Carey said the SA market was "very competitive – and a market that loves its flavoured milk." The company has not revealed how much market share it planned to take in SA.

Farmer's Union owner National Foods spokesman Julian Caples said iced coffee was a clear market leader here with South Australians drinking 36 million litres of it every year. "South Australians drink 45 million litres of flavoured milk every year and we have 82 per cent of the market," he said. "We wish Coca Cola well."

He said competing products, including Fleurieu Milk Company's new natural iced coffee, were healthy for the market.

His company has dominated Australian flavoured milk sales, worth $305 million last year, with a 44 per cent share of supermarket sales and 35 per cent of all deli and convenience store sales under Farmer's Union, Masters, Divine Classic and Big M brands.

Australians, particularly men aged 16 to 24, have increased their consumption of flavoured milk recently.

Last financial year supermarket sales rose 17 per cent to $193.5 million, and 10 per cent more flavoured milk was sold in delis and convenience stores, worth $111.1 million, than the previous year.