Fonterra aims to fill Chinese dairy demand

New Zealand-based Fonterra has announced plans to establish a dairy farm in China through its Shijiazhuang SanLu Group, in which Fonterra holds a 43% stake.

The company has proclaimed China the fastest growing dairy market in the world and is currently talking to local government authorities in China about securing land for the farming operation, set to start production in October 2007.
“To meet market demand in China we need to be producing milk locally. By developing a cow-to-consumer supply chain in China we will be able to create value for our joint business and improve returns to our respective shareholders. China’s dairy industry is expanding rapidly and milk production is expected to increase from 22bn litres currently to 40bn litres in seven years’ time,