Free Subscription

  • Access daily briefings and unlimited news articles

Premium

Only $34.95 per year
  • Quarterly magazine and digital
  • Indepth executive interviews
  • Unlimited news and insights
  • Expert opinion and analysis

ANZ formula companies reeling in wake of China’s production plans

Infant milk formula companies in Australia and New Zealand including Bellamy’s and the A2 Milk Company were dealt a blow this week after China unveiled a plan to boost its local formula output and reduce reliance on imports.

China revealed plans to exceed 60 per cent self-sufficiency for baby formula and improve the quality of domestic brands, Bloomberg reported.

Authorities are hoping to restore confidence in the $27 billion industry after a deadly milk scandal in 2008, which saw several deaths and tens of thousands of babies hospitalised, rocked consumer confidence in local products.

AuMake made a statement on Wednesday regarding China’s plans saying that it will not be affected as it sources infant milk formula brands from ANZ suppliers and these are then purchased by Australian-based daigou and visiting tourists.

“Delivery of ANZ products to China via parcels (including the payment of all relevant taxes) continues to be a secure pathway for ANZ products to reach the Chinese market,” the company said in a statement to the ASX on Wednesday.

A2 Milk fell 11 per cent to NZ$14.09 on Tuesday, while Bellamy’s Australia Ltd. lost 5.4 per cent, or A$50 million ($35 million), adding to Monday’s 3.2 per cent drop.

You have 3 free articles.