-
Fonterra - Source: ONE News -
Related
Fonterra says its $20.7 million Chinese dairy farm - at the city of Tangshan in Hebei province - is now one of the best in China.
It now has 4,500 cows and by this time next year, the herd should have been lifted to 6,000, Philip Turner, managing director of Fonterra China told the China Daily in Beijing.
The newspaper said that Fonterra had a cow-to-consumer supply chain in New Zealand that used the world's best practices and this management expertise had been introduced to the Tangshan operation.
The Tangshan dairy farm is 85% owned by Fonterra, and Turner said Fonterra has the option to start more dairy farms in cooperation with Chinese partners.
China's big dairy market posted double-digit annual growth and a demand of 27 billion litres of milk - nearly twice Fonterra's New Zealand milkflows. The Chinese consumption per-head was still low, "creating huge potential for growth," the newspaper reported.
"Fonterra sees a clear opportunity for more joint venture farms with best-practice processes," it said. "Chinese partners can supply capital while Fonterra has the farm and management experience."
The New Zealand company also had two new milk powder products set to hit markets in east and south China: Anlene high-calcium milk powder to help prevent bone-density loss, and Anmum for pregnant women, Turner said.
Fonterra had 5% of China's dairy market last year, and combined sales of foreign dairy products comprised about 12% of the total, said Turner, who noted that China is the world's most open dairy market.
He said that there are many opportunities for his company and it was committed to a long-term development strategy.
"We have been here for a long time and we are going to be here for a long time," he said.
Fonterra has been the leading supplier of imported milkpowder in China for 20 years.
The China Daily did not mention Fonterra's role in the Sanlu Group scandal, or its 43% stake in that Chinese joint venture which was destroyed by sales of milk poisoned with melamine to infants. At least half a dozen babies died and the melamine - used to conceal dilution of milk sold to Sanlu and other companies - damaged the health of 300,000 children and other consumers.
The former chairwoman of Fonterra's joint venture in China, Tian Wenhua, was sentenced to life in prison for manufacturing and selling fake or substandard products, and fined 24.7 million yuan (about $NZ6.9 million).
Fonterra wrote off its 43% Sanlu shareholding for a loss of $201 million, but later reported increased sales of imported milkpowder in China as parents avoided domestic product.
But the China Daily did report Fonterra "has reaffirmed its confidence in the Chinese market and promises to bring more products and make more investment".
It quoted chief executive Andrew Ferrier, as saying one of the company's priorities is to help build a safe supply chain in China while continuing its exports of high quality dairy products.
"The Chinese government has done a very good job in food safety and we will play a role in helping build a safe supply chain in China," he said.
