China’s biggest milk producer Mengniu has signed a contract with Malaysian distributor Hai-O, giving it access to its third international dairy market.
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While China’s dairy industry has long suffered from lack of domestic supply, a rapid increase in production in recent years has given its leading dairies ambitions for foreign expansion.
Mengniu, which dominates China’s UHT milk market with a 33.3% share, entered the Singapore market last year and the Philippines in 2005. It has also seen strong sales growth in Hong Kong.
“In order to develop into an international company, Mengniu has to expand abroad. Southeast Asia is close to China and there is a large market demand to be fed,” Weng Fengliang, the firm’s international sales manager, told just-food.
Malaysia’s dairy market is small, with current annual milk consumption of 7.7kg per capita. But government promotion of dairy is driving growing demand, said Weng.
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By GlobalDataHai-O expects Mengniu to take a 10% share of the Malaysian market within a year.
