China-controlled New Zealand dairy firm to join booming global protein trade

Source:Xinhua Published: 2013-5-8 13:35:11

A Chinese-controlled New Zealand dairy company announced Wednesday it was to become the world's second manufacturer of an ultra-fine form of the lucrative milk protein lactoferrin to meet booming demand from China.

Synlait Milk would invest NZ$15 million ($15.27 million) to upgrade its special milks drier at Dunsandel, in the South Island, in order to tap into the Chinese infant formula market, which was valued at $15 billion  a year.

The company said the investment would enable it to become one of only two manufacturers in the world to produce lactoferrin as a spray dried powder, and would enable it to manufacture dairy ingredients to a pharmaceutical standard.

Lactoferrin -- a bioactive protein that provides significant antibacterial protection and other health benefits -- was in demand globally for health foods including infant formula and adult nutritional powders.

With the new capability, Synlait Milk expected production to reach 18 metric tons within four years after commissioning in late 2013 to early 2014, Chief Executive John Penno said in a statement.

The decision to invest in the high value ingredient was stimulated by contracts with eight significant Chinese customers for infant formula, including Xi'an-based YinQiao Dairy, the largest dairy manufacturer in northwest China, Synlait Milk's cornerstone shareholder Bright Dairy and A2 Corporation, which would soon launch is own infant formula brand in China.

"There is a global shortage of lactoferrin driven largely by the demand for infant formula. In China alone total sales of infant formula are worth $15 billion plus a year and growing by 15 percent with the addition of 18 million to 20 million new babies annually," said Penno.

The market for lactoferrin had grown from 45,000 kg in 2001 to 185,000 kg last year and was projected to reach 262,000 kg in 2017.

Shanghai-based Bright Dairy purchased a 51-percent stake in the Synlait Milk in 2010.
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