Australian farm fresh milk has hit Chinese supermarket shelves, signalling the beginning of a new frontier for dairy producers.
Fresh milk can now travel from Australia to supermarkets in China in just seven days.
Until recently this would have been impossible – the milk would have exceeded its shelf life by the time it travelled from Australia and cleared Chinese customs and quarantine.
«It’s taken us 12 months to get to this point,» Peter Verry from Peloris Global Sourcing said.
«Commercial shipments started over a month ago and in that time we’ve done approximately 20,000 litres.»
Peter Verry and his partners have even bigger plans for the Australian business – by the end of the year they hope to import 50 times more milk each month, a total of one million litres.
Mr Verry says that’s just the beginning.
«We actually think that’s a conservative number,» he said.
«We are working closely with [Australian airline] Qantas to ensure we’ve got the infrastructure in place.»
The milk being imported to Nanjing, from a dairy cooperative in New South Wales, is sold in upscale supermarkets.
«We think annually we can get as high as 20 million litres a year,» he said.
«With the growing middle class and high income earners in China, the demand for Australian fresh milk is going to outstrip supply in the not too distant future.»
Demand for imports following melamine scandal
Imported products are unaffordable to many outside the major east coast Chinese cities like Beijing, Shanghai and Nanjing.
Those cities were among the first to develop after China implemented economic reforms more than three decades ago.
The Australian milk is expensive – just one litre of the milk costs $AU9.50 – around four and a half times the price of milk produced by a Chinese company.
Customers in Nanjing are keen buyers, despite the price.
The Chinese dairy industry is still suffering from the fallout of the 2008 melamine scandal, where milk was contaminated with an industrial chemical.
It’s thought more than 300,000 people were affected and six children died as a result.
Milk consumption fell precipitously, and the Chinese dairy industry hasn’t recovered.
University professor Zheng Fengtian was one of the many alarmed Chinese parents who abandoned local dairy products and instead bought imported powdered baby milk for his child.
«The entire dairy industry is very complicated: there are so many farm owners, the supply chain is so long, there are so many companies involved,» he said.
«So even though the Chinese government has put in a lot of effort to improve the standard of the dairy industry, it’s not something that can be solved in a day or two.»
Now that Chinese parents can choose to have a second child, the opportunities for dairy companies around the world have increased even more.
That’s the silver lining for Australian dairy farmers who have endured a horror year of drought and low prices.
Source: Yahoo