Danisco invests in China’s dairy and supplements sector

By Kacey Culliney

- Last updated on GMT

Related tags: Compound annual growth rate

Danisco invests further in China with dairy and supplements market a focus
Danisco invests further in China with dairy and supplements market a focus
Danisco will expand production of its Live Culture Inoculant (LCI) cultures in China to meet the growing demand for fresh dairy products and dietary supplements in the country.

The company has purchased a food processing plant north of Beijing, close to some of Danisco’s customer locations, and plans to convert it into a blending and packaging facility late next year.

Richard Donovan, communications manager for the Cultures Division at Danisco, said that this new facility is part of a wider growth plan for freeze-dried LCI cultures.

“This investment is in addition to the announcement made previously by Danisco of a three year, €60m ($85m) worldwide cultures investment programme,” ​he told FoodNavigator-Asia.

Danisco’s current China presence includes a global R&D facility in Shanghai and six production plants across the country, across eight cities including Beijing, Kunshan and Wuxi, Donovan noted.

Yongjing Li, president of Danisco China, said that the investment is significant and is evidence that the ingredients producer has a strong, long-term commitment to the Chinese market.

The facility will support growth and increase production of Danisco’s YoMix ​dairy cultures as well as its Howaru​ probiotics.

Fabienne Saadane-Oaks, president of Danisco BioActives, added: “With increasing regional customer demand for both products, we expect to see continued growth for the foreseeable future.”

Dairy and dietary supplements in China

A Euromonitor report published earlier this year detailed the growth in China’s dairy sector, specifically in fermented dairy products. It is estimated that this sector will achieve a 12% compound annual growth rate (CAGR) in the period 2011 to 2016.

A growing Chinese middle-class, greater urbanisation and the increasing adoption of packaged convenience food is fuelling the uptake in dairy products.

Vitamins and dietary supplements are also seeing similar growth in China, with an estimated growth of 6% CAGR, driven by growing disposable incomes and improved consumer health awareness.

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