New Zealand shares dropped 1.4 per cent on Wednesday with A2 Milk Co and Synlait Milk sold off over competition from Nestle in China.
A2 Milk dropped 6.5 per cent to $12.94, with $32.7 million in turnover. Nestle has confirmed it is “currently launching an A2 product” under its Illuma brand, with the product said to be called Atwo and sold in China.
“Today’s selling has been very much lead by A2 which always has been volatile, and the main reason being news that Nestle has launched an A2-branded formula in China,” Goodson said.
“They’re a major company with strong distribution channels and deep pockets, and the price point that looks comparable to A2, so it no longer has the market to itself.”
Synlait Milk, which has booked gains over the past year in sync with A2, dropped 4.6 per cent to $8.68.
