Published December 6, 2008

China Milk to make dairy products

By LYNETTE KHOO
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CHINA Milk has expanded downstream. The producer of pedigree bull semen, pedigree dairy cow embryos and raw milk said yesterday that it has begun raw milk processing to churn out dairy products under its own proprietary brand, Yinluo.

PRODUCTION PLAN
China Milk's new dairy-processing plant will initially process about 50 to 80 tonnes of raw milk per day and produce a range of flavoured milk beverages and yogurt drinks before expanding into other products such as ice-cream

With a total processing capacity of 100,000 tonnes annually, the group's new dairy-processing plant will initially process about 50 to 80 tonnes of raw milk per day and produce a range of flavoured milk beverages and yogurt drinks before expanding into other products such as ice-cream.

The group was recently nominated by Heilongjiang as its sole supplier of milk products for the government and its affiliates.

Besides selling its products to the Heilongjiang government departments, the group plans to market its Yinluo products in north-eastern provinces Liaoning and Jilin, and the major cities of Beijing and Shanghai.

The group is also currently negotiating a milk-processing contract with an OEM customer and will make an announcement in due course.

China Milk chief executive Liu Hailong said this marks an important milestone for the company in becoming a fully integrated dairy company with expertise in cattle genetics, dairy farming to manufacturing and marketing of dairy products.

'Moving ahead, we will continue to focus on increasing the sales of our Canadian Holstein bull semen and embryos as there remains a robust demand for herd improvement in China,' Mr Liu added.

For the second quarter ended Sept 30, China Milk's net profit grew 8.38 per cent to 108.3 million yuan (S$24 million) while revenue jumped 25.11 per cent to 165.9 million yuan. Raw materials and consumables used also increased by 25.1 per cent in line as its herd size grew to 21,626 as at Sept 30 from 16,543 a year ago.