Source: Fonterra news release
Fonterra and the Government of Yutian County of China have formally agreed to develop a new Fonterra dairy farm in Yutian County, Hebei Province.
Fonterra’s $31.3 million (U.S) investment signals the next step in its strategy to expand local milk production on the ground in China, following the successful pilot of Tangshan Fonterra Farm.
Fonterra CEO Andrew Ferrier and Fu Zhenbo, deputy party secretary from Yutian County, signed the agreement in a ceremony Oct. 21 in Beijing.
“China is a very important market for Fonterra, and we’re committed to developing and investing in the local dairy industry over the long term,” Ferrier said. “The fast-growing demand for dairy in China will be met by locally produced milk and we want to be working alongside the local dairy industry to help meet this demand.”
Fonterra is a global dairy company co-operatively owned by 11,000 New Zealand dairy farmers.
The new Chinese dairy will house around 3,000 milking cows, imported from New Zealand. It’s expected to employ around 100 local people, most of whom will live onsite in a housing facility.
The farm site construction will take around 12 months, with the new herd expected to start milking in November 2011.
The new free stall dairy farm, Fonterra Yutian Farm, will be developed on 42 hectares of land in Yutian County, Tangshan City, which is halfway between Beijing and Fonterra’s existing farm in Hangu, also in Tangshan City. Fonterra said the dairy location has good access to water, feed supplies and locally grown crops like corn silage. It will consist of 12 barns, feed storage facilities, a 24/7 milking parlor and wastewater treatment systems.
“The Tangshan Fonterra Farm pilot successfully demonstrated our ability to produce high quality milk locally,” Ferrier said. “Today’s agreement further strengthens Fonterra’s capacity to deliver a secure and sustainable supply of fresh dairy products for Chinese customers and consumers.”
Fu Zhenbo, Yutian County deputy party secretary, said: “Fonterra has a reputation as a leader in farming best practice globally, so we welcome the investment in our region. We believe Fonterra’s second farm will contribute to building Yutian’s reputation as an important agricultural region in Hebei Province.”
The setup and management of Fonterra Yutian Farm will be similar to Fonterra’s first pilot farm in Hangu. Established in 2007, the farm has grown from 3,000 cows to over 6,000 and is producing around 25 million litres of milk for local consumption.
The new farm is managed under a Risk Management Programme and audited according to Fonterra’s Standards of Excellence for milk production, to ensure the production of safe, traceable, high quality milk.