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Speculation of a possible joint move by Fonterra and a2 Milk to buy Synlait raises a much bigger strategic question, says agribusiness expert Dr Nic Lees.
Evergrande Dairy has sold two million cans of Cowala branded infant formula in China; it aims to double sales this year.
Evergrande Dairy Group general manager Yu Wei Ming says this shows NZ infant formula is making a comeback in China after Fonterra's false botulism scare two years ago. It also proves infant formula made in NZ still resonates well with Chinese consumers, he says.
Ming was in Auckland recently to attend a Cowala charity event: for every can of Cowala sold in China, Evergrande is donating 10c to the Foundation of Youth Development in NZ.
Evergrande hopes to make Cowala a top infant formula brand in China. Ming says the 100% NZ product is the main reason for Cowala's early success.
NZ infant formula's reputation in China took a hit after Fonterra's false botulism scare in 2013. This allowed infant formula makers in Europe to steal our market share.
Ming says competition remains strong but the NZ brand is making a comeback.
"After the crisis, NZ branded infant formula sales dropped a little," he told Rural News. "But each year we have millions of new babies and new mothers and there is new awareness about NZ infant formula.
"We are gradually seeing NZ products getting back and in the next two-three years NZ products will get back on the right track."
Evergrande markets its Cowala infant formula as 100% from NZ and the best in the world.
He notes that Cowala's first year sales form a small proportion of the total infant formula sales in China.
"We are focussing on lifting sales and targeting to double sales this year; tripling sales will be even better."
Evergrande Dairy owns 51% of GMP Dairy, a South Auckland infant formula maker among the first to get new accreditation from Chinese authorities.
GMP Dairy managing director Karl Ye says the company has received great support in NZ over the last 14 years. "It's now time to pay back to the community for the support," he says.
The 'Cowala 10c of Love' charity was launched to coincide with the mid-autumn moon festival in China.
Evergrande and GMP were a big sponsor of a charity auction night for children with autism, held in June by Young Business Women in NZ.
Evergrande Dairy is part of the Evergrande Group, which started in real estate and has since diversified into other businesses including fast moving consumer goods.
Cowala infant formula's claimed point of difference is its world-first patented traceability via the cans: this allows consumers to use their smartphone to scan a barcode telling them the milk powder's history and shows an x-ray picture of the contents.
Shipping information on each can helps streamline access at the Chinese border.
