Thursday, May 10, 2012

April Issue of Dairy Products China News Comes Out

CCM International’s April issue of Dairy Products China News has newly published recently. The latest issue covers a range of sector developments but stand outs are Wahaha seeking dairy farms in Australia and Fonterra looking to expand its dairy farms in China. Heading to farm in either direction demands deep pockets and political goodwill. The idea of partnerships to facilitate such ventures – whether between Fonterra and Shanghai Pengxin or others – may make a lot of sense.

Certainly producing milk in China has state support: the Chinese Government wants international dairy companies to establish industrial-style farms to produce high quality fresh milk for its consumers weary of food scares centred on dairy products. Ironically perhaps – although in truth this signifies a structural adjustment in the sector which should surprise no-one – the corollary of this is that for many dairy farmers in China life is getting harder. The recent reduced prices for milk being paid by Wondersun in Heilongjiang present a contrast to the April prices rises from Mead Johnson and Nestlé. Such price rises appear to have limited impact on sales, reflecting the specifics of the product category.

At a wide level, unexpectedly low import figures for March 2012 reflect modest levels of domestic demand in China. These are figures to watch as private consumption needs to rise to reduce the need for investment spending. Doubters over the economy’s future are not hard to find, although most private sector forecasters remain positive. The Asian Development Bank, for one, expects GDP to rise to 8.5% in 2012 and consumption to grow by 12% in 2012 and 2013, reflecting higher wages and rising government expenditure on social services. It believes the latter will encourage Chinese consumers to save less: going on price trends, they may well have to. Please check the April Issue of Dairy Products China News to discover more.

Headline News in the latest issue include:
-Recently, several large-scale grain & food processors have made steps towards further diversification – a sign of trends in the market which seem likely to accelerate in the future.
-In late February, the General Administration of Customs of China confirms a higher tariff on milk powder imported from New Zealand from 1 March.
-On 6 March, the State Council issues a new policy to support the development of leading agriculture enterprises in line with recent trends in the agribusiness sector.
-Yunnan launches a guideline for the formulation of local food safety standards which is being implemented from 1 April.
-On 14 March, Yili announces its investment programme and development goals for 2012, shortly after the release of its full report for 2011.
-On 3 March, Wahaha reveals its plans for dairy farming in Australia, in line with the company’s diversification and integration strategies.
… …

Dairy Products China News, is co-published by CCM International & Orrani Consulting, which is unique in combining genuinely global experience in the dairy industry. Dairy Products China News brings you the latest information on new market dynamics, company dynamics, new dairy products and consumption trend, new legislations and policies and raw milk supply dynamics that are shaping the market. If you need more information of this newsletter, please feel free to contact us at

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