Fonterra’s Chinese business partner Beingmate has been financially damaged by a case of alleged milk powder tampering, causing it to forecast a loss of up to $48 million for the first quarter of the financial year…Full Article: July 2016

Key Point

  • Beingmate had projected a NZ$21 million profit, but revised this figure to a NZ$44.5 million to NZ$48 million loss in the wake of a counterfeit infant formula scandal.

ChinaAg Comments

  • In April 2016, a Beingmate Baby & Child Food authorized dealer was found selling fake/counterfeit Beingmate (China), Abbott Laboratories (USA), and Vitacare (New Zealand) infant formula products. The arrested dealer was authorized to sell products from Beingmate Baby & Child Food Co. Ltd., which is based near Shanghai in Hangzhou. From August 2014 to May 2015, the Beingmate-authorized dealer repackaged high-priced branded products with lower-priced product, and then sold the counterfeit products to retailers in Zhengzhou (Henan Province) and Hefei (Anhui Province).
  • In March 2015, Fonterra purchased an 18.8% stake in Beingmate Baby & Child Food Co Ltd. At the same time, Fonterra’s Chief Executive announced plans to invest NZ$1.5 billion (US$1.13 billion) in China and boost its production capacity to 1 billion liters by 2020.
  • In January 2015, China’s Ministry of Commerce approved Fonterra‘s request to purchase a 20 percent stake in Beingmate.
  • In August 2014, Fonterra announced plans to purchase a 20% stake (US$467 million) in Beingmate (based in Hangzhou, Zhejiang Province). Beingmate in return would hold a 51% stake in Fonterra’s Gippslands milk powder factory in Victoria, Australia (near Melbourne).
  • In April 2013, Fonterra stated it hoped to export its infant formula (e.g. Anmum Infant and Follow-On Formula) to mainland China by mid-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 Baby & Child Food (SHE:002570) 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.

Similar Posts by ChinaAg

Spread the word. Share this post!