Ireland now second biggest exporter of infant formula to China

Ireland is now the second-largest exporter of infant formula to China, jumping ahead of New Zealand for first time this year.

According to figures from Bord Bia, based on Chinese customs data, Irish exports of retail-ready infant formula to China amounted to 13,100 tonnes in the first half of this year. This equated to about 17 per cent of Beijing’s import market for finished formula.

The Netherlands, the largest exporter of infant formula to China, accounts for about 34 per cent of the market.

Bord Bia’s figures reveal China’s imports of infant formula grew by 27 per cent in the first six months of 2015, hitting nearly 75,000 tonnes.

This marked a turnaround on the previous year, when volumes fell on foot of regulatory uncertainty and stockpiling from the previous year.

Adulteration scandal

The spark that ignited China’s seemingly insatiable demand from foreign formula came in 2008, when thousands of babies fell ill from domestic formula products made from milk adulterated with melamine, a toxic chemical which artificially boosted the milk’s protein count.

Huge swaths of the population decided the only safe food for babies was foreign formula – the domestic market still has not recovered from the scandal.

The four main infant formula companies exporting to China from Ireland are Wyeth, now part of Nestlé, Abbott, Danone and Kerry Group.

Kerry Group launched an Irish infant formula brand called “Green Love+” in China last year. It retails at a hefty €43 per kilo – almost four times the Irish price.

David Owens from Bord Bia's dairy sector said the agency was focused on building the image of Ireland as a premium supplier of infant formula and other dairy products.

Premium image

“Our credentials around food safety, combined with our outdoor production systems, give us that premium image in the market, and we’re trying to build on that.”

China ranks as Ireland’s second-largest dairy export market, valued at €404 million in 2014. Irish dairy exports to China for the first half of this year grew by almost 25 per cent. If that trend were to continue for the remainder of 2015, the value of our Chinese dairy exports would reach €500 million, Bord Bia said.

While dairy prices have flatlined in the past year, global demand is still forecast to outstrip supply by 25 billion litres by 2020 – a trade gap that exporting countries such as Ireland will be keen to exploit.