Opportunities as China imports Cornish clotted cream
Britain is gearing up to sell Cornish clotted cream to customers in Beijing, Cheddar cheese in Nanking supermarkets and Devon yoghurt in Shanghai delis in a move which it is hoped will help fill a £1 billion hole in the UK economy.
Westcountry dairy farmers are rising to the challenge of changing palates in China where, on the back of a growing economy, there is a rapidly developing taste for more western food – including dairy.
Dairy consumption in China, which is predicted to become the world's largest economy ahead of the US by 2016, is increasing as affluent lifestyles change, and farmers are hoping to seize on this window of opportunity while domestic production cannot meet the demand.
Environment Secretary Owen Paterson is spearheading the biggest-ever food trade delegation to China this week to help promote food exports.
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However, Westcountry farmer co-op Arla Milk Link is well ahead of the game, already having a significant presence in the Far East.
"We have a major operation in China which is already benefiting our 1,600 farmer members," said Will Sanderson, Arla Milk Link's corporate affairs director. "We welcome the Government initiative – but we're already there in a major venture."
He added: "China is the fastest-growing dairy market in the world and has over 1.3 billion consumers. Over the past year we have made strong progress in relation to expanding our presence in this strategic growth market."
Milk Link joined with the giant Danish-based Arla co-operative earlier this year in a deal popular with its shareholder members, the majority of whom are in the South West.
Central to the company's growth in China was the signing in June of a strategic agreement with China's biggest food company, COFCO, on a co-ownership of the country's largest dairy, the Mengnui Dairy Company, Mr Sanderson added.
"This will result in our supplying European dairy products to China under the Arla brand that will reach Chinese retailers via Mengnui's distribution network," he said. "Our goal over the next few years will be to send between 600 and 800 million kilograms of milk annually to China, mainly in the form of value-added products."
In addition, Arla has now entered into a 10-year contract with Chinese food company Biostime to produce up to 20,000 tons of milk powder for the infant formula market per annum.
Mr Paterson will this week meet dairy companies, trade associations, industry experts and retailers in Shanghai.
He will also be strongly promoting tea, desserts, beer, meat, and confectionery produced by British companies.