Global dairy cooperative Fonterra will invest $550 million [~US$467 million] in Chinese dairy giant Beingmate to increase access to the lucrative infant milk market. The deal includes a 20 per cent share of the Chinese company and joint ownership of Fonterra’s state-of-the-art milk powder factory at Gippsland in Victoria. Under the proposed agreement, Beingmate will own a majority share in the Gippsland plant, but operations will continue to be run by Fonterra…Full Article: ABC Rural Aug 2014

Key Point

  • According to the Managing Director of Fonterra Australia, from 2014 to 2017, China’s infant market formula will increase from AU 18 billion to AU 33 billion (~US$16.8 billion to US$30 billion).

ChinaAg Comments

  • From 2013 to 2015, China’s infant-formula market is expected from grow from CNY 50 billion (US$7.97 billion) to an estimated CNY 80 billion (US$12.9 billion) (estimated in April 2013).
  • As of April 2013, Fonterra managed two milking farms in Hebei province and planned to open an additional three farms shortly thereafter. Fonterra intended to have a Chinese milk production capacity of 1 billion liters per year by 2018.
  • Established in 1992 and headquartered in Hangzhou, Zhejiang province, Beingmate produces and distributes infant food including milk substitutes, weaning foods and dietary supplements. The company also supplies toiletries, baby beddings, strollers, textiles and children’s toys.

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