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Yili eyes more moves into overseas market

By ZHU WENQIAN | China Daily | Updated: 2017-05-16 07:37
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The stand of Yili Industrial Group Co Ltd at an industry expo in Beijing. WU CHANGQING / FOR CHINA DAILY

Dairy producer looking at acquiring new assets to consolidate global position

China's biggest dairy producer, Inner Mongolia Yili Industrial Group Co Ltd, said it plans to further move into overseas markets in the next three to five years.

Last year, Yili achieved sales of 60.6 billion yuan ($8.78 billion), and net profit of 5.67 billion yuan, the latter up 21.8 percent year-on-year. In the first quarter of 2017, its net profit reached 1.74 billion yuan.

Yili Vice-President Xu Ke said his group is now the eighth largest dairy group worldwide.

"We aim to become one of the top five global producers in the near future and reach an annual sales revenue of more than 100 billion yuan," Xu said.

Xu said China still had significant growth potential for milk consumption.

According to the China Dairy Industry Association, the current annual per capita milk consumption in China is only half the world average, and one-third of the average volumes in Asia.

Meanwhile, Yili is eyeing more overseas assets to consolidate its leading position.

The group recently announced it was bidding for full control of leading US organic yogurt brand Stonyfield, whose production line covers yogurts, smoothies, milk and cream, and it is currently owned by French dairy giant Danone.

Xu said that the dairy producer had similar such overseas acquisition plans for the next few years.

In recent years, Yili has been expanding its investments in countries and regions that are related to the Belt and Road Initiative.

In 2014, it established the world's largest integrated dairy production center in New Zealand, named Yili Group Oceania Dairy Ltd, with an investment of 3 billion yuan. It is currently producing around 47,000 metric tons of infant formula a year.

This March, the dairy giant unveiled the second-phase expansion project at its New Zealand dairy production center. Yili said it would expand the second-stage production to ultra-high-temperature treated milk, whole milk powder and other products.

The factory is located in the small town of Waimate, where Yili created nearly 100 jobs and became one of the largest employers in the region.

In addition, the company founded a scholarship program to provide funds for local high-school graduates, particularly to those who are willing to take a career path in dairy research, as well as to foster communications between China and New Zealand.

Yili Chairman Pan Gang said the Belt and Road Initiative is a visionary project that has already grown beyond people's expectations.

"Our base is also an example of what can be achieved with Chinese vision, resources, capital, New Zealand innovation and world-leading agri-science and abundant natural resources," Pan said.

He said that by partnering with the best of New Zealand's farmers, researchers, academics and scientists, Yili would achieve significant advances in dairy and food technology.

"We have committed to New Zealand for the long term and while these benefits may take years to come to fruition, they will be worth the wait," he added.

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