Find Hot News in Dairy Products China News 1301

Published on the 31^th every month, Dairy Products China News is a monthly publication released by CCM. It offers timely update and close follow up of China’s various kind of Dairy market dynamics, analyze the market data and trends. Major columns include 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.

Following are headline news of the latest issue of Dairy Products China News:

Prospects for the Cheese Market in China

Distributor Roria indicates its confidence in the cheese market in China and sees new consumption occasions amongst consumers.

Consumers Focused on Infant Formula Brand Reputations

Baidu research data on consumers' online searches again highlights the ongoing focus on formula brands' reputations in Q3.

Dairy Imports Increase

The increase in dairy imports during January- November reflects the strong domestic demand last year.

Government’s Import Tariff Cut for Specialty Infant Formula

In mid-December, GACC announces an import tariff cut for specialty infant formula (HS Code 2106909001) in 2013, which will aid this segment of the market to some extent.

Yili Plans a New Infant Formula Plant in New Zealand

On 17 December Yili announces its plan to build a new infant formula plant in New Zealand, one concrete result from its persistent globetrotting looking at opportunities in the last few years.

Vitasoy Prospers in H1 FY 2013

In late November, Vitasoy releases its financial report for the first half of its fiscal year to 30 September 2012, showing its excellent performance.

Taizinai Group Rebuilds with Fresh Strategy

Taizinai Group's continues to re-establish its business since the restart in September 2011, its success being attributed to some adjustments in its development strategy.

Ausnutria Consolidates Overseas Activities

On 30 November, Ausnutria buys out the remaining 49% of its Dutch acquisition Hyproca, demonstrating its commitment to expansion overseas.

Manor Pasture Launches IPO Plan

In mid-December, Manor Pasture releases its IPO plan for listing on the SZSE (Shenzhen Stock Exchange), aiming to raise capital for further business expansion.

Hohhot Launches a New Farm Project

Hohhot, China's "Dairy City', completes the first stage of the new farm project which it launched last June, part of its drive to develop large-scale dairy farms.

Arla Foods Launches UHT Milk

On 8 December, Arla Foods introduces its UHT milk into Chinese market, indicating its further expansion in China after signing the cooperation agreement with Mengniu in June 2012.

New UHT Buffalo Milk from Royal Dairy

Royal Dairy launches Qingyang, a new UHT buffalo milk under the brand of Molafeier, as part of its push to expand its premium buffalo milk business. 

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Cooperation between Chinese & Overseas Dairy Industries in Vogue

On 9 October, Beingmate revealed a cooperation with Ireland’s Kerry Group Plc (Kerry). It comes in the wake of similar moves from Wahaha, Synutra and China Investment Corporation (CIC) in September, suggesting an acceleration in the trend towards cooperation between Chinese and overseas companies in the dairy industry, according to CCM’s October issue of Dairy Products China News.

Beingmate signed the strategic cooperation contract with Kerry on 2 October; the arrangement includes 4 aspects:

 Cooperation in infant formula & infant foods: Kerry will provide comprehensive technical support for Beingmate (in theory, on a worldwide basis), whilst Beingmate will prioritise Kerry in its raw materials supply and product development initiatives

 Overseas cooperation: Kerry will suggest a “new management structure overseas” – possibly a subsidiary or cooperation project of some sort

 Kerry will be active in providing technology support in nutrition and infant formula/foods for Beingmate when required

 Beingmate can visit Kerry R&D centres, and Kerry should treat Beingmate’s projects preferentially

Kerry has historically transitioned to being a major ingredients and flavours group in which dairy plays a relatively minor role. However it is Ireland’s no. 2 supplier to China of the key formula ingredient demineralised whey powder and has had a longstanding supply relationship with Beingmate. The deal is especially timely as Ireland’s milk supply is undergoing a significant growth phase in preparation for Europe’s post quota era. In the first phase of the partnership, investment is starting immediately at Kerry’s Listowel and Charleville sites in Ireland with the intention of doubling its local output of demineralised whey and infant formula base mix.

Beingmate’s move follows several similar arrangements and initiatives (please see Dairy Products China News Vol.5 October Issue, p14).

The trend is entirely predictable: after the 2008 melamine scandal and years of ongoing dairy and formula safety scares, an increasing number of consumers prefer dairy products produced overseas or based on raw materials from overseas. This situation has caused a marked pickup in demand for imported dairy commodities.

Competitive factors are also key, with the Chinese party often struggling or at some disadvantage in the formula market. The fierce competition from Yili is central to Mengniu’s decision to cooperate with Arla Foods, and similar rationales lay behind the moves to partnership from Synutra and Beingmate – both businesses’ performances have been mediocre in recent times. Bright Dairy is a relative newcomer in formula and so the deal with Synlait was a logical step up on the ladder.

The main targets for such deals are Oceania and Europe. Both regions are attractive in terms of their quality. Oceania scores in terms of logistics and pricing, whilst Europe offers the advantage of being the main source of demineralised whey products. Companies from both regions are regularly in the Chinese market meeting customers and trade.

The US is another key option but suffers by comparison on most of these points, despite its dairy industry’s strong capabilities in whey products. The US formula industry’s preference for the WPC/

lactose combination over demineralised whey does not position it well in the face of the Chinese preference for D70/D90. Although Euroserum delivered the first demineralised whey powder to Chinese formula producers, the key factor in establishing this preference was the New Zealand push to sell this simpler solution to the Chinese industry whilst it sought to focus on WPC manufacture for higher value applications. That decision also reflected the lack of consistency of the quality of WPC at the time, especially to infant formula standard. New Zealand later moved away from demineralization but the practice was established, and nowadays Chinese buyers also express concern over the consistency of lactose and WPC options. This background is one reason why so far the US role has been mainly in terms of investment – for instance in the cases of Modern Dairy, Feihe Dairy, Synutra, etc. Such considerations surely point to partnership opportunities in China for some of the South American processors, though to date there has been little evidence that they are ready to take them up.

Source: Dairy Products China News 1210

http://www.cnchemicals.com/Newsletter/NewsletterDetail_22.html

Content of Dairy Products China News 1210:

Cooperation between Chinese & Overseas Dairy Industries in Vogue

Sichuan Dairy Industry Development

New Standards for Powdered Beverages & Soy Milk/Drinks

New Concern Over Raw Milk Standard

Privatisation of Feihe Likely

Xiaoyangren Group to Launch Plant

Kangquan Dairy Pushes for Growth

Treasure of Plateau Invests in New Plant

Raw Milk Price Remains High

Industry Focus on Dairy Farming Continues

Flower Cow Milk Launches New Premium Milk

A2C to Launch Formula

Dairy Products China News, a monthly publication issued by CCM on the 30th/31st of every month, 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.

About CCM

CCM is dedicated to market research in China, Asia-Pacific Rim and global market. With a staff of more than 150 dedicated highly-educated professionals. CCM International offers Market Data, Analysis, Reports, Newsletters, Buyer-Trader Information, Import/Export Analysis all through its new proprietary product ValoTracer. For more information, please visit http://www.cnchemicals.com.

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