French dairy’s Chinese joint-venture could boost Sodiaal’s fortunes

18-Apr-2016 - Last updated on 19-Apr-2016 at 08:03 GMT

Related tags Milk

Candia, a French milk producer, has joined Zhejiang International Business in a joint-venture which it hopes will deliver EUR145m (US$161m) in sales of branded UHT milk and baby milk in China by 2020.

Backed by initial funds of 50 million renminbi (EUR7.3m), the Sodiaal business unit will concentrate on Greater Shanghai and Jiangsu and Zhejiang provinces by selling its products in dedicated shops developed with ZIB, independent retailers and internet platforms.

"This agreement allows us to enlarge the horizon where we can propose our products," Candia director-general, Giampaolo Schiratti, told Reuters.
With a 10% stake in the joint-venture, Candia hopes to help its parent company—France’s biggest dairy co-operative, with 13,200 members and sales of EUR5.4bn in 2014—to market over 40m litres of French milk annually.

The deal was signed in France by Chinese premier Li Keqiang at a time soon after European Union milk quotas were removed.

Schiratti said the Candia-ZJNAC deal would take time to develop amid a global slump in milk prices: "It will help in the long run but not solve [dairy’s] short-term crisis.”