The latest major rule change came in April, when the EU removed a cap on raw milk production that had controlled output in each country in the bloc for about 30 years. Farmers there now have more freedom in how they do business. And with the French milk market nearly saturated, China has emerged as an arena with immense potential.
The Isigny Sainte-Mere dairy cooperative completed construction of a new production facility for powdered formula for babies in northwestern France. The project was jointly funded by Chinese dairy product maker Biostime International Holdings. With the new facility, the cooperative’s capacity will increase from 20,000 tons per year at present to 50,000 tons by 2018. A third of the output will be reserved for the Chinese company.
In September, Les Maitres Laitiers du Cotentin agreed to form an 11-year partnership with Synutra International, China’s leading supplier of baby formula. The parties said they will spend 114 million euros ($122 million) to build a factory in northwestern France capable of producing 690 million powdered milk packages annually. They plan to launch sales in China sometime around April 2017.
Synutra also plans to open a powdered milk plant in January in western France together with leading French dairy cooperative Sodiaal. The two formed a partnership in 2012, with Sodiaal selling more products under its own brand in China.
Nutribio, a subsidiary of Sodiaal, in July announced plans to begin selling organic powdered milk in China under the Nactalia Organic brand. Its Chinese partner, Century International Trading, will oversee sales in China. Nutribio specializes in producing nutritional food for babies and pregnant women under the Nactalia brand, which has been in China since 2012.
Healthy interest
China has received a lot of bad press over the health hazards posed by air pollution there and food and water contamination. One upshot of the heightened focus on these issues has been an increase in health consciousness among the public.
China’s organic food market expanded an estimated 15% on the year in 2014, according to a private organization familiar with organic foods. Another private research company said the country’s market for baby formula is roughly 700,000 tons per year. Of that amount, organic products account for about 7%, which leaves considerable room for growth.
Triballat Noyal, based in France’s Brittany region, began selling health food for weight watchers in China about a year ago. It aims to double sales outside France over the next five years and generate half its earnings overseas.
Source: Asian Review