BMI expands dairy exports to China

GERMAN dairy cooperative Bayerische Milchindustrie (BMI) expects to increase exports to China, after entering into an agreement with a second distributor in addition to its current distribution partner, Shanghai Yuechang, with which BMI has cooperated successfully in China for years.

Beginning in 2014, Pacific Dairy Ingredients (PDI) will help boost sales in China for the greatly expanded BMI lactose range and the new Bayolan P80, a protein-enriched whey powder concentrate, which is obtained using state-of-the-art ultrafiltration and has an 80% protein content.

Shanghai Yuechang will continue to concentrate on the successful products Bayolan 50, a 50% demineralized whey powder, and Bayolan sweet whey powder concentrate.

Both partners in China are established market players and are exclusive distributors of BMI's Bayolan brand of dry products as part of their range.

Peter Hartmann, spokesman of the BMI management board, described the new distributor arrangement as “an important step in our plans to expand in Asia, which focus on China.”

BMI milk and whey powders are sold in nearly 50 countries worldwide with Asia, and China in particular, playing an important role.

Rising global demand

BMI already generates around half of its annual sales revenues from exports. Its focus is on dry products, which make up BMI's core area of expertise and largest division, along with fresh products and cheese.

Emerging markets make up 12% of BMI's exports, behind Europe. The Landshut, Germany-based cooperative hopes to further increase this percentage by focusing on Asia through the new partnership in China.

“Global demand for milk and dairy products will continue to rise. As a result, we have increasingly set our sights on countries outside Germany in addition to our domestic market,” Mr Hartmann said.

Growth market

China is currently one of German dairy industry’s most important sales markets. The large population, rising standard of living and changing consumption habits have resulted in strong demand for dairy products in China, which far exceeds the local supply.

German-made quality is highly sought-after, BMI said. Multi-purpose dry milk products like whey powder and whey powder derivatives as well as lactose products, which the food industry uses in finished products like baked goods, confectionary and baby food, play a major role. Whey products and their derivatives are obtained from whey, which is a by-product of dairy processes such as the production of cheese and quark, a fresh cheese.

Since China has no cheese production to date, these powder products largely needs to be imported from foreign countries – from producers like BMI, which has successfully marketed its Bayolan brand dry products in China for nearly 15 years and now aims to expand its position.