Chinese language - Nestle inaugurated new milk product factory

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BIZCHINA / Overseas Investment

Nestle inaugurated new milk product factory

By Jiang Wei (China Daily)
Updated: 2007-07-06 10:12

Swiss food and beverage giant Nestle yesterday inaugurated a new milk
product factory in northern China's Inner Mongolia Autonomous Region in a
move to take bigger share of the Chinese market.

With an initial investment of 130 million yuan, the Nestle Hunlunbuir
facility is the company's third dairy factory in China, following one in
Shuangcheng, Northeast China's Heilongjiang Province and an operation in
Qingdao, East China's Shandong Province.

Nestle's wholly owned Hunlunbuir factory will make milk powder by
processing some 600 tons of milk a day, said Peter Brabeck, chairman
andCEOof Nestle Group Worldwide.

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Nestle, which does not own farms in the Inner Mongolia, procures fresh
milk from 40,000 farmers, generating a total regular income of 3 million
yuan a day.

As a multinational company with over 140 years of experience in the dairy
business, Nestle has standardized milk collection among dairy farmers,
replacing the old-style system of collection on the street.

"The company applies better hygienic conditions and stricter quality
standards to milk collection," said He Haijun, a dairy farmer. "At the
beginning we did not understand, as this overturned our traditional ways
of diary farming that pin so much hope on the weather and climate, but we
did learn a lot in the process."

Head of Nestle's Greater China region Josef Mueller said the company
selected the location a few years ago due to the region's rich natural
grasslands. The move also draws Nestle closer to its Chinese competitors,
whose large milk producing facilities are also located in the Inner
Mongolia.

In another development, the company expects to open its second research
and development center in China next year. According to Brabeck, the new
center in Beijing will feature research, as its first in Shanghai is
focused on product development.

(For more biz stories, please visit Industry Updates)

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