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Major dairy companies invest in China
The positive sounds surrounding the recovery of the Chinese market seem to inspire confidence both nationally and internationally. Dairy giants Danone and Fonterra have announced that they will further expand their activities on Chinese territory. And that while the activities on Chinese soil have been difficult for Fonterra for some time.
Both companies are investing in a new research center in Shanghai. Fonterra is also investing in a development center in Wuhan. The New Zealand dairy cooperative says the expansion beyond Shanghai to regional cities such as Wuhan is part of its strategy in China.
Danone
French dairy Danone says it will invest €100 million on Chinese territory. This amount includes an acquisition of a local baby food producer, which was previously owned by Saputo Dairy Australia. A portion is also being spent on expanding development in the field of medical nutrition.
Part of the investment was also used for a new development and research center that recently opened its doors (July 14). The center offers a workplace for 100 researchers. The innovations that are being developed are aimed not only at the Chinese market, but also at Danone's worldwide activities.
Danone has been investing in the Chinese market since 1987. Earlier this year, investments were made in a so-called Track & Connect service that provides consumers with insight into the production of the dairy product. From farm to consumption, which can be viewed by means of a QR code.
Corona crisis
Despite the corona crisis, Danone manages to keep its head above water. The processor will reasonably keep the milk price above €34 per 100 kilos and will continue to collect milk. Fonterra, on the other hand, has reduced its milk price several times, although the dairy processor is more positive about the future.
With regard to the export of milk to China, Fonterra's most important sales market, the corona crisis has previously brought about a positive atmosphere. In total, 5% more milk was exported to the Asian powerhouse in the first 25 months of this year than in the same period the year before.
Jorine Cosse
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