Swiss food and beverage giant Nestle yesterday inaugurated a new
milk product factory in northern China's Inner Mongolia Autonomous
Region in a move to take bigger share of the Chinese market.
With an initial investment of 130 million yuan, the Nestle
Hunlunbuir facility is the company'sthird dairy factory in China,
following one in Shuangcheng, northeast China's Heilongjiang
Province and an operation in Qingdao, east China's Shandong
Nestle's wholly owned Hunlunbuir factory will make milk powder
by processing some 600 tons of milk a day, said Peter Brabeck,
chairman and CEO of Nestle Group Worldwide.
Nestle, which does not own farms in the Inner Mongolia, procures
fresh milk from 40,000 farmers, generating a total regularincome of
3 million yuan a day.
As a multinational company with over 140 years of experience in
the dairy business, Nestle has standardized milk collection among
dairy farmers, replacing the old-style system of collection on the
"The company applies better hygienic conditions and stricter
quality standards to milk collection," said He Haijun, a dairy
farmer. "At the beginning we did not understand, as this overturned
our traditional ways of diary farming that pin so much hope on the
weather and climate, but we did learn a lot in the process."
Head of Nestle's Greater China region Josef Mueller said the
company selected the location a few years ago due to the region's
rich natural grasslands. The move also draws Nestle closer to its
Chinese competitors, whose large milk producing facilities are also
located in the InnerMongolia.
In another development, the company expects to open its second
research and development center in China next year. According to
Brabeck, the new center in Beijing will feature research, as its
first in Shanghai is focused on product development.
(China Daily July 9, 2007)