The U.S. Dairy Exporter Blog: Market Analysis, Research & News

  • The 2020 Mid-Year Global Dairy Business Review

    By Mark O'Keefe July 18, 2020

    See the significant mergers, acquisitions, joint ventures, new facilities, executive hires and marketing initiatives for the first six months of this memorable year.

    At the beginning of 2020, few could have predicted the tumultuous six months ahead, with the entire world battling a global pandemic, COVID-19. Global dairy businesses had to deal with a new normal that seemed to change every day.

    Nonetheless, business activity remained brisk, as one can see from the U.S. Dairy Export Council's 2020 Mid-Year Global Dairy Business Review. 

    USDEC closely monitors media coverage of global dairy business for our members and summarizes what they need to know in our weekly, members-only newsletter, Global Dairy eBrief. From those newsletters, we cherry-picked what's most relevant to share with you here.

    We started with items from the January 3 Global Dairy eBrief and ended with news from the June 26 edition. This is a thorough, fast-paced, review. We put company names in bold for easy scanning.

    What follows is a one-of-a-kind, curated, aggregated and highlighted archival summary of global dairy business developments for the first half of 2020, presented in month-by-month chronological order.

    Put another way, we present to you the global dairy business news that was.

    Look for the full-year 2020 Global Dairy Business Review in January.  

    January Plans for a €140-million Glanbia/A-ware cheese plant in Belview, Ireland, were put on hold over objections from two environmental groups. The groups cited concerns over greenhouse gas emissions, water quality and ammonia. The Dutch-style cheese plant is a joint venture between Glanbia Ireland and the Netherlands’ Royal A-ware, who were planning to begin construction next year, with commercial production by the end of 2022. The plant would produce about 40,000 tons per year of continental cheese in “Euro blocks” (13-15kg) and 11,500 tons of “valued-added” cheeses in 250g-3kg packages. (Irish Times, 12/20/19)

    Southeast Asian dairy, food and beverage giant Fraser & Neave (F&N) is building a new manufacturing, R&D and distribution center in Singapore focused on innovation, smart technology and sustainability. The new 375,000-sq.-ft., S$80-million site (about US$60-million) will feature a state-of-the-art storage and retrieval system that integrates manufacturing, warehousing and distribution of chilled products, solar panels, wastewater recovery systems and other design elements that will allow the company to move most of its Singaporean non-alcoholic beverage operations under one roof. F&N says the facility will increase its innovation capacity and as well as contribute to the vibrancy of Singapore as a food innovation hub. (USDEC Southeast Asia office; Straits Times, 12/4/19)

    U.S. private equity fund Bain Capital is in talks to buy Indian ice cream and dairy processor Dinshaw’s Dairy Foods. Dinshaw’s has been on the selling block for months; media reports previously pegged Hindustan Unilever as the leading bidder . . . Hong Kong-listed infant formula maker Ausnutria and German can producer Trivium Packaging are building a joint-venture can manufacturing plant on-site at Ausnutria’s infant nutrition facility in Heerenveen, Netherlands. The €30-million (about US$34 million) project will have a capacity of 150 million cans per year by 2021. The partners also signed a 10-year supply agreement in conjunction with the deal. (FoodBev.com, 12/23/19; Live Mint, 12/23/19)

    Little Caesars Enterprises is setting its sights on international markets, planning to open “hundreds” of stores next year outside the United States. The company named India, the Philippines, Poland, Spain, the UK and Vietnam as major targets . . . Aaron Forde is stepping down as CEO of Irish agribusiness Aurivo. He said it was “time for a new leader to take Aurivo to the next phase of growth.” (RTE News, 12/24/19; Bloomberg, 12/19/19)

    China’s Mengniu Dairy paid a combined $106 million for a 5% stake in cheese and dairy manufacturer Shanghai Milkground Food and a 43% stake in Jilin Guangze Dairy Technology (a wholly owned subsidiary of Shanghai Milkground). In the first half of 2019, sales for Shanghai Milkground’s cheese business doubled to $48 million, half of that due to a five-fold increase in a snack cheese stick. Mengniu has been seeking to grow its cheese business for the past few years, in part by cooperating with Denmark’s Arla Foods on developing cheese products that cater specifically to Chinese tastes. (USDEC China office; Company reports)

    Borden’s Chapter 7 bankruptcy filing this week reignited press stories about the decline of dairy in the face of plant-based alternatives. NMPF issued this statement after the filing to set the record straight: “U.S. dairy remains a strong and diverse industry. Looking more broadly than milk in a glass, per-capita dairy consumption has been on the rise since the 1970s, with 2018, the most-recently reported year, being the most popular year for U.S. dairy since 1962. Fluid milk remains a staple in 94 percent of U.S. households today and continues to outsell plant-based imitators by a margin of more than 11 to 1.” Unlike Dean Foods’ bankruptcy, Borden intends to restructure, shed debt and position itself for “long-term success.” The company cited its debt load and pension obligations as the cause of the filing. (NMPF; CNN Business, 1/6/20)

    Coca-Cola Co. acquired the outstanding stake in ultra-filtered milk processor fairlife from its joint-venture partner Select Milk Producers. Chicago-based fairlife will continue to operate as a stand-alone business. (Company reports)

    Hong Kong-listed infant formula company Ausnutria is making a push into China with its Australian milk powder business Oz Farm. The company plans to launch new packaging targeting Chinese consumers, engage with customers at special events and online, and advertise on mother-child themed TV programs, among other activities. Ausnutria acquired Oz Farm in 2018, the year after buying Australian infant formula manufacturer ADP . . . The European Whey Processors Association (EWPA) took over the Arla Foods Ingredients’ consumer-focused whey educational website wheyforliving.com. EWPA plans to use the forum to “inspire and ensure that discussions about whey proteins, as well as other proteins, are based on facts and science-based knowledge rather than myths or hearsay” . . . Cold Stone Creamery’s Singaporean partner Refinery Concepts plans to close all three Cold Stone outlets in Singapore by the end of January. (USDEC Southeast Asia office; Company reports)

    The Mexican Food Security Agency (SEGALMEX), the Durango state government and local businessmen announced a joint project to build a milk plant in the municipality of Gómez Palacio. The facility, which should be up and running by January 2021, will manufacture up to 100 tons per day of milk powder, as well as ultra-pasteurized fluid milk. In conjunction with the plant, the partners will build two collection centers in Lerdo and Nuevo Ideal. The project will support local dairy farmers and Mexico’s LICONSA milk program. LICONSA operates 327 points of sale in Durango, selling milk at a subsidized price of 2.5 pesos (about US 13 cents) per liter. (USDEC Mexico office)

    Belarusian dairy Savushkin Product paid $23 million for a majority stake (50.7%) of Belarusian cheese and dairy processor Baranavichy Dairy. Savushkin is reportedly interested specifically in expanding Belarusian cheese output and pledged to invest at least $5 million within two years to increase semi-hard cheese manufacturing capacity at Baranavichy’s plant in the Brest region. (Dairy Markets, 1/10/20)

    Ireland’s Aurivo named CFO Donal Tierney as new CEO effective immediately. Tierney replaces Aaron Forde, who announced he was stepping down late last year. (Agriland, 1/13/20)

    NutriCo Morinaga, a joint venture between Japan’s Morinaga Milk Industry and Pakistan firms ICI Pakistan and Unibrand, began commercial production at a new $36-million infant/growing-up formula facility in Sheikhupura, Pakistan, near Lahore. The plant’s annual capacity is 12,000 tons per year. (just-food.com, 1/15/20; The News International, 1/15/20)

    TRIOMF East Africa, a group of South African and Rwandan investors, is building a $38-million milk powder plant in Rwanda’s Northern Province under the name of East African Dairies. Local farmers will have a 20% stake in the facility, with TRIOMF controlling 80%. The partners claim it will be the first dedicated milk powder facility in Rwanda and the largest dairy plant in the country. It will handle 260 tons of raw milk per day. Construction is supposed to start in late 2020, with completion one year later. (The New Times, 1/20/20)

    Singapore-listed food and agri-business firm Olam International is reorganizing its portfolio into two operating groups: Olam Food Ingredients (including its dairy, cocoa, coffee, nuts and spices business) and Olam Global Agri (grains, animal feed, edible oils, rice, cotton and commodity financial services) . . . Singapore start-up TurtleTree Labs says it has developed technology to create real milk without the animal. The company uses stem cells to create mammary gland cells that can lactate. (USDEC Southeast Asia office)

    Arla Foods broke ground on a new 97,000-sq.-ft., €40-million (about US$44-million) innovation center in Nr. Vium, Denmark. The center will serve Arla’s Arla Foods Ingredients (AFI) division covering a range of R&D projects, including advanced separation technology to isolate specific components of whey and milk, heat treatment, and pasteurization technology to improve ingredients’ functionality and shelf-life. Arla said the facility, which includes labs and a pilot plant, will work closely with AFI’s nearby Danmark Protein site to “create a unique environment for process development and pilot production to unleash all the wonders of whey.” It is expected to open in summer 2021. (Company reports)

    Federal antitrust regulators are probing the potential acquisition of Dean Foods by Dairy Farmers of America. The Justice Department is discussing with farmers and retailers the potential impact of such a deal on milk prices and competition in the dairy sector . . . Jon Jenkins, formerly CEO of Allied Milling and Baking, took over as CEO of Britain’s Müller Milk & Ingredients, after Patrick Müller stepped down. Patrick Müller will continue to serve as CEO of Müller’s home delivery business Milk & More. (Wall Street Journal, 1/27/20; DairyReporter.com, 1/27/20)

    February-2Michigan-based Lakeview Capital acquired The Mochi Ice Cream Co., Los Angeles, from private equity firm Century Park Capital Partners. Lakeview says it plans to invest “significant capital” to make the company a “leading, global branded mochi snack platform” . . . Germany’s DMK Group is selling its Waldfeucht-Haaren ice cream plant to Schwarz Produktion—the manufacturing arm of German retail group Schwarz Group. DMK will concentrate its ice cream operations at its Prenzlau and Everswinkel sites. It plans to increase Everswinkel ice cream capacity from 65 million liters per year to 100 million liters. (Company reports; Forbes, 1/31/20)

    Citing reduced milk flows, Lactalis Australia is closing its Rockhampton, Queensland, fluid milk plant and scaling back yogurt production at its South Brisbane site. The Rockhampton plant has been running only 3-4 days per week “for a number of years.” The company said it will transition yogurt production to plants in Victoria and Tasmania. (ABC, 2/5/20)

    Canada’s Saputo will close its Trenton, Ontario, cheese plant this September and its Saint John, New Brunswick, fluid and fresh products facility in January 2021. The company cited the need to improve operational efficiencies and “right-size” its manufacturing footprint and sales force in Canada. Production will transfer to other locations within Saputo’s Canadian dairy division. Separately, the company promoted Richard Wallace to president and COO of its Australian dairy division (he was formerly senior VP of operations there). Carl Colizza, president and COO of Saputo North America, will assume (on an interim basis) an additional role as head of Saputo’s Dairy Foods Division (USA) when current USA President and COO Paul Corney retires this summer. (Company reports)

    Seattle-based Darigold is spending $67 million to expand fluid milk processing capabilities at its Boise, Idaho, facility. Strong sales for its FIT ultra-filtered milk line precipitated the project, but the expansion will also see additional capacity for other Darigold beverages as well. The investment includes an aseptic processing line to produce FIT in a shelf-stable version. Darigold expects to complete the expansion by the fall of 2020. (Company reports)

    Dairy Farmers of America (DFA) agreed to pay $425 million to buy 44 of Dean Foods’ fluid and frozen facilities and the real estate, inventory, equipment and “all other assets” necessary to operate the facilities. The deal is not yet final. It is subject to higher or “otherwise better” offers until March 31, 2020, and still must gain regulatory approvals. Dean said it was currently in discussion with other parties for 16 facilities (plants and depots) not included in the DFA agreement. (For a full list of plants covered by the deal and those left out, click here.) Dean reportedly received purchase interest from 99 entities after its original bankruptcy filing. (Company reports; The Dallas Morning News, 2/17/20; New York Times, 2/17/20)

    Norway’s TINE doesn’t expect to start producing Jarlsberg cheese at its new €77-million greenfield production plant in Mogeely, County Cork, Ireland, until this summer. The plant, which will make 14,000 tons of cheese per year to start (with eventual expansion to 20,000 tons), is a partnership between TINE and Irish Co-op Dairygold. Product is earmarked for export to Europe, Australia and the United States. The projected opening date for the facility was originally summer 2019, but TINE has pushed it back multiple times due to regulatory and other delays. (Company reports; DairyReporter.com, 2/17/20)

    Malaysian agribusiness firm FGV Holdings entered the dairy sector by acquiring a majority stake in RedAgri Farm, a Malaysian milk producer/fluid milk processor and owner of the Bright Cow brand name. (USDEC Southeast Asia office)

    Arla Foods plans to invest €619 million (about US$670 million) in major projects this year to expand capacity in milk powder and other sectors targeting international demand. It will be an annual capital investment record for the Danish company and will include completing a powder tower in Pronsfeld, Germany, expanding mozzarella capacity in Branderup, Denmark, and upgrading Bahrain cheese production . . . Swiss food processing expert Bühler Holding and flavor and fragrance house Givaudan plan to open an innovation center in Singapore late this year dedicated to plant-based products . . . The European Investment Bank is lending €50 million (about US$54 million) to Polish dairy processor Mlekpol for a series of expansion and modernization projects at Mlekpol’s Grajewo facility, including additional milk processing capacity, wastewater treatment and warehousing/logistics . . . Vertically integrated Australian dairy processor Mungalli Creek Dairy opened a new A$3-million (about US$2-million) processing plant in Millaa Millaa, Queensland, and paid another A$3 million for additional farmland to increase milk production. Mungalli makes organic milk, cheese and yogurt. (USDEC Southeast Asia office; Company reports; European Commission; Food & Drink Business, 2/18/20)

    March-4Australian calf milk replacer manufacturer ProviCo purchased Fonterra Australia’s Dennington, Victoria, milk powder plant. The company expects to double production of its milk replacers with a focus on its ProfeLac line. While it will not collect milk from farmers, ProviCo says it buys from “virtually every dairy manufacturer in Australia,” and plans to increase whey purchasing from Australian cheesemakers for drying at Dennington. ProviCo hopes to finalize the purchase in mid-April and begin operations “soon after.” Fonterra shuttered the facility in late November 2019 due in part to reduced milk flows in Australia. (Farm Online, 3/2/20)

    Dutch nutrition science company DSM paid €765 million (about US$853 million) for Human Milk Oligosaccharides (HMO) maker Glycom, based in Denmark. DSM is focusing on creating and commercializing HMOs and expanding markets beyond infants to children and adults . . . Swiss dairy ingredient and infant formula maker Hochdorf sold its 60% percent stake in Germany’s Uckermärker Milch to its joint venture partner Ostmilch Handels. Hochdorf had planned to utilize the Uckermärker plant to make infant formula and other products for European and Central and South American markets but instead opted to expand its site in Sulgen, Switzerland . . . California-based Brothers International Desserts purchased Wisconsin’s Schoep’s Ice Cream, which filed for receivership last fall. (Company reports; Wisconsin State Journal, 2/27/20; DairyReporter.com, 2/27/20)

    Fonterra Co-operative Group Chairman John Monaghan plans to retire as a director of the co-op when his term ends in November. The company plans to announce a chair-elect by no later than August. (New Zealand Herald, 3/5/20)

    Knowing what the competition is up to can be critical to plotting export growth strategy. Here are some of the latest product rollouts competing with U.S. dairy:

    • Arla Foods introduced a new line of plant-based products under the brand name JÖRÐ. The initial lineup includes three milk alternatives: Oat, Oat & Barley and Oat & Hemp. The line will debut in Denmark, Sweden and the UK, but Arla says it will investigate opportunities in other markets. Arla called JÖRÐ “adjacent to [its] existing product portfolio” and said, as a category leader in dairy, “it is natural for Arla to enter this category and contribute to the development of it with new products and flavors.”
    • Separately, Arla expanded its Arla Organic Milk line to Malaysia. The product is halal and lactose free.
    • Nestlé Australia launched a plant-based version of its powdered Milo The product replaces milk powder with soy and oats. The rollout follows the December 2019 debut of the oat- and pea-based Ninho Forti + in Brazil and the January introduction of GoodNes chocolate oat beverage under the Nesquik name.
    • Thailand’s CP-Meiji merged traditional Thai flavors with dairy in two new pasteurized milks based on Thai desserts. Nom Bua Loi Phuak combines taro ball in coconut milk and Ruam Mit mixes coconut milk, tapioca, sugar, corn, lotus root, sweet potato and jackfruit together in a dessert bowl. CP-Meiji translated both to fluid milk. The products are a prime example of innovation and tailoring products to regional tastes.
    • Japan’s Megmilk Snow Brand launched what it claims is the first fermented milk product with a functional food claim for allergies. Nyu-San-Kin Helve helps relieve eye and nose discomfort from allergies due to its Lactobacillus helveticus SBT2171 content, the company says.
    • Asahi Group is rolling out a soy version of its Calpis cultured milk drink in April. The product, Green Calpis, will target health-conscious women and non-dairy consumers. (USDEC Southeast Asia office; Company reports; FoodNavigator-Asia.com, 3/10/20, 3/3/20)

    Qatari dairy Baladna signed a deal with Jordan’s Brother’s Co. for Food Industry wherein Brother’s will help the company start-up a new cheese production line. The Jordanian company is an expert in manufacturing Arab sweet cheese, particularly Nabulsi cheese . . . Tunisian dairy company Land’Or plans to build a €16-million (about US$18-million) cheese plant in Kenitra, Morocco. The facility, set to open in the first quarter of 2021, will produce canned cheese, melting cheese and fresh cheese for the Moroccan market . . . Canada’s Agrifoods Cooperative entered into a licensing agreement with New Zealand’s a2 Milk Co. to be the exclusive processor for the a2 brand in Canada . . . The Australian government earmarked A$15 million for Australian dairy export assistance. The money will be used to reduce red tape involved in exporting, streamline audit arrangements and raise export awareness. (USDEC Middle East office; Company reports; DairyGlobal.net, 3/9/20; Morocco World News, 3/7/20)

    New Zealand’s Overseas Investment Office approved two Synlait Milk purchases: its buyout of New Zealand dairy processor Dairyworks and its acquisition of a 1,400-acre dairy farm adjacent to its Dunsandel, South Island, processing plant. The company said it planned to use the land to provide better water security, install a rail siding that will eliminate 16,000 truck movements per year, and conduct farming trials and research. (DairyReporter, 3/16/20; Stuff.co.nz, 3/11/20)

    France’s Bel Group purchased French plant-based food manufacturer All in Foods. All in Foods markets plant-based cheese alternatives under the Nature & Moi brand. The purchase aligns with Bel’s strategy to “diversify our product offering to meet new consumer expectations,” the company said. (Company reports)

    The governments of Indonesia and the Netherlands reportedly signed a partnership agreement for cooperation on three major projects, including construction of a new Frisian Flag milk plant in Indonesia by FrieslandCampina. No further details are known at this time . . . The UK’s Bradbury’s Cheese is spending £8.5 million (about US$10 million) to develop a new range of cheese snack products and pursue other growth projects aimed at domestic and export markets. (USDEC Southeast Asia office; The Business Desk, 3/11/20)

    Dean Foods and Dairy Farmers of America (DFA) agreed to “mutually terminate” their $425-million asset purchase agreement announced in February. The original deal had prompted strong objections from some farmers and agriculture advocacy groups as well as some members of DFA and Dean shareholders. Dean will continue to accept bids for its assets through March 30 and said in a statement that it still expected DFA to submit a bid. DFA said it was reevaluating its options. (Wisconsin State Farmers, 3/25/20)

    Italy’s Newlat is in talks to acquire a majority stake in Italian dairy group Centrale del Latte d’Italia. Newlat makes pasta, baked goods and baby foods; the Centrale del Latte d’Italia investment would mark its entry into dairy . . . UK-based consumer products company PZ Cussons reached an agreement to sell its Nigerian dairy business Nutricima to FrieslandCampina WAMCO. Nutricima makes and markets a variety of powdered, evaporated and ready-to-drink milk and yogurt beverages under the Nunu and Yo brands . . . New Zealand’s a2 Milk increased its stake in fellow Kiwi dairy processor Synlait Milk from 17.4% to 19.8%. (Motley Fool Australia, Reuters, 3/23/20; 3/19/20; Food Business Africa, 3/19/20)

    April-1Dairy Farmers of America (DFA) came out on top as the winning bidder for the majority of Dean Foods, despite the cancellation of their original purchase agreement last week. DFA will pay $433 million to acquire the assets, rights, interests and properties relating to 44 of the company’s fluid and frozen facilities. Prairie Farms purchased eight facilities, two distribution branches and certain other assets. Dean has long relationships with both buyers. Mana Saves McArthur and Producers Dairy Foods were the winning bidders for facilities in Miami and Reno, Nev., respectively. Harmoni Inc. purchased Dean’s Uncle Matt’s business. “Substantially all of our processing assets will continue to operate as dairies,” Dean said. All agreements are subject to court approval and certain other closing conditions. (Company reports)

    Fonterra Co-operative Group is selling its China Farms operations as well as its joint venture stake in DPA Brazil. The co-op wrote down both operations by a combined total of NZ$134 million this year, after writing off NZ$200 million on China Farms alone last year. The farms, carrying 31,000 milking cows housed in a feedlot system, are now worth NZ$500 million. Fonterra is also reviewing its joint farming venture in China with Abbott (which it wrote down by NZ$62 million this year). (Company reports)

    Australian-Kiwi dairy processor Keytone Dairy Corp. started commercial production at a second facility in Rolleston, New Zealand, and signed multiple contracts to supply companies marketing in China and Oceania. Keytone says it inked deals with Iovate Health Sciences Australia, Walmart (China) Investment and Nouriz (Shanghai) Find Food worth a combined total of A$5.3 million. The China deals are follow-on orders for milk powder under the Sam’s Club and Nouriz brand names. The Iovate deal is a “long-term manufacturing agreement,” but terms of the contracts or products to be made were not defined. The new Rolleston plant on the South Island triples Keytone’s manufacturing capacity and will allow the company to realign sales toward “higher value proprietary products.” The plant is registered with the Certification and Accreditation Administration of the People's Republic of China and can produce infant formula. Keytone plans to sell to domestic and international markets and says it is also fast-tracking an online sales platform. (Company reports)

    A federal bankruptcy court approved Dairy Farmers of America’s bid to purchase most of Dean Foods. But included in the sale contract is language that would allow certain grocery chains or dairy groups to file claims against their merger . . . Singapore’s F&N Dairy Investment plans to buy more than 17 million shares in Vietnamese dairy Vinamilk, lifting its overall Vinamilk stake to almost 19%. (USDEC Southeast Asia office; Politico, 4/6/20)

    Business continues in the midst of pandemic: Egyptian cheesemaker Riyada is targeting a 22% increase in exports this year to reach $11 million. In addition to expanding sale in current Middle Eastern markets, the company is targeting South Africa and East Asia . . . Slovenian dairy Ljubljanske Mlekarne shipped its first load of ice cream to China as part of a 43-ton order—its first with a Chinese buyer. (USDEC Middle East office; BNE IntelliNews, 4/13/20)

    Japan’s Meiji paid $255 million for a 25% stake in Singapore-based Japfa Ltd.’s Chinese dairy farming operation AustAsia Investment Holdings. The deal is aimed at securing milk supply as it expands its processing operations. Meiji is expanding production capacity for milk and yogurt at its existing Chinese plant in Suzhou, a project that it expects will go online in Spring 2021. It is also building a new plant in Tianjin, with operations expected to start in the second half of 2022. Meiji says its Chinese business is expanding steadily, particularly demand for chilled milk. (USDEC Southeast Asia office; Company reports)

    New Zealand’s Fonterra is among a group of companies that invested a total of €15 million in German food start-up YFood. YFood makes meal replacement drinks and bars containing dairy protein. (Reuters, 4/21/20)

    China’s Yili Group plans to build a $423-million, vertically integrated dairy farm and milk processing operation in Zhumadian, Henan Province . . . German dairy processor Hochwald contracted with SIG Combibloc Group to provide 15 aseptic filling machines for Hochwald’s processing plant being built in Mechernich, Germany. The plan, due for completion in 2022, will turn up to 800,000 tons of milk per year into UHT milk, cream, condensed milk and flavored milk for the Europe and export markets in China, Middle East and Africa. Britain’s Futura Foods opened a new cut-and-wrap plant in Minffordd, North Wales. The facility is the former site of GRH Food, which shut down last summer before being bought by Futura. (Futura is owned by Danish dairy business Nordex Food.) The company said the facility will complement its existing range of cheeses, allowing it to expand into cheddar, mozzarella and traditional UK cheeses as well. (Cambrian News, 4/19/20; Xinhua, 4/10/20)

    May-3

    Australia’s Camperdown Dairy, a unit of Australian Dairy Nutritionals Group (ADNG), is building an A$8-million infant formula plant in Camperdown, Victoria. The facility, which ADNG says is a “stepping stone to a much larger investment,” will include a “small evaporator and dryer and mixing plant.” The company plans to target export markets with its own-label brands. (Farm Online, 4/24/20)

    MGD Acquisition is buying Dean Foods’ Hilo, Hawaii, manufacturing plant, related distribution branches and a license to the Meadow Gold Hawaii brand name . . . Borden Dairy and Dean bondholders proposed a merger as an alternative to the sale of most of Dean’s assets to Dairy Farmers of America (DFA). The bondholders said the merger would avoid any antitrust concerns related to the Dean-DFA deal . . . Royal Group, an investment firm backed by Abu Dhabi’s royal family, is reportedly paying $1 billion for a 20% stake in Middle Eastern hypermarket chain LuLu Group International. (USDEC Middle East/North Africa office; Company reports; Wall Street Journal, 4/23/20)

    Dutch dairy giant FrieslandCampina opened a new 280,000-sq.-ft. distribution facility in Veghel, Netherlands. The operation handles ingredient distribution for European and export markets, particularly the activities of FrieslandCampina’s DFE Pharma business . . . Vietnam’s Vinamilk completed its first production run of sweetened condensed milk for export to China. The company signed a $20-million contract to supply its Ông Tho brand to a Chinese buyer at this year’s Gulfood. (Company reports)

    Infant formula maker Wattle Health Australia agreed to a strategic partnership with Australian canner Shepparton Partners Collective (SPC). SPC will help Wattle secure an A$20-million (around US$13-million) line of credit in exchange for Wattle shares and, eventually, co-ownership of Wattle’s Uganic organic infant formula brand. Wattle will use the money to complete its Corio Bay spray-drying plant in Victoria. The company markets the Uganic brand in Australia and China. When Uganic sales hit A$10 million, the partnership will become a 50-50 joint venture. (The Market Herald, 5/4/20; IEG Vu, 5/4/20)

    The U.S. Justice Department said it would approve Dairy Farmers of America’s (DFA’s) $433-million bid to purchase Dean Foods subject to DFA selling processing plants in Harvard, Ill.; De Pere, Wis.; and Franklin, Mass. . . . China’s New Hope Dairy paid $240 million to buy northwest China dairy processor Ningxia Huanmei Dairy Development. (Caixin Online, 5/6/20; Politico, 5/4/20)

    Swiss dairy group Hochdorf is dissolving three business units after failing to find buyers. The company will liquidate snack maker Snapz Foods, vegetable oil processor Marbacher Ölmühle and dried fruit maker Zifru Trockenprodukte as part of its strategy to narrow the company focus to baby care and dairy ingredients . . . British coffee chain Costa Coffee, owned by Coca-Cola, is taking its ready-to-drink coffee beverages to China. The company already operates more than 500 Costa coffee outlets in China. (Company reports; FoodNavigator.com, 4/30/20)

    French dairy giant Lactalis is investing €1.8 million (about US$2 million) in its Bosnian division Lactalis BH and its Inmer dairy manufacturing plant. (SeeNews, 5/11/20)

    Coca-Cola set up a joint venture with China’s Mengniu Dairy to produce and sell chilled milk in China. The two sides reported no further details of the plan, the size of the investment or the brand name for the milk. Less than 30% of Chinese households currently purchase chilled milk, according to Kantar Worldpanel China, so growth potential is “huge,” Kantar said. (ECNS, 5/13/20)

    Swiss flavor and fragrance company Givaudan is selling its processed and grated cheese business to Dutch specialty cheese business St. Paul Group. St. Paul Group describes itself as “a supplier of cheese solutions for the food industry” and expects the Givaudan deal to help it build its position in ready meals, snacks and processed foods. (Company reports)

    Foremost Farms USA is closing its Chilton, Wis., Italian cheese plant. The company cited decreased demand from foodservice due to COVID closures as well as operational inefficiencies due to the age of the facility . . . Nestlé is investing CHF100 million (about US$103 million) to expand manufacturing operations in China. The company plans to build its first plant-based products plant in China, increase capacity at its Tianjin pet food plant and upgrade its confectionery operation. (Company reports; Wisconsin State Farmer, 5/18/20)

    Australia’s largest organic milk producer Organic Dairy Farmers of Australia (ODFA) entered receivership, owing unsecured creditors A$3-5 million and National Australia Bank A$8 million. The company cited slow sales to China and the impact of coronavirus among a range of external pressures on the business. Creditors met this week to discuss ODFA’s fate. The co-op owns a fluid, butter and cream plant in Geelong, Victoria. (ABC, 5/27/20)

    Barry Callebaut Group acquired Australia-based chocolate maker GKC Foods and plans to add an additional production line to GKC’s Melbourne plant. (USDEC Southeast Asia office; FoodBev.com, 5/27/20)

    Japan’s Yakult is opening three new sales offices in China and expanding its factory in Wuxi, Jiangsu Province. Construction on the manufacturing plant was supposed to start in April but was postponed to August due to COVID. The expected completion date is April 2022 . . . Food Lion and the Maryland and Virginia Milk Producers Cooperative Association filed an antitrust lawsuit against Dairy Farmers of America (DFA) challenging its acquisition of most of Dean Foods’ assets. The plaintiffs charge that DFA is “an aspiring monopolist” and are seeking an injunction to block the sale, even though the U.S. Justice Department gave it a greenlight earlier this month. (DairyReporter.com, 5/26/20; FoodDive, 5/20/20)

    June-3Australia’s Keytone Dairy Corp. signed a licensing agreement with R&A Bailey & Co. to distribute ready-to-drink Bailey’s non-alcoholic coffee-flavored milk drinks and powdered beverages. The products are slated for rollout in August and will be manufactured at Keytone’s Melbourne plant. The company will begin distributing the products in Australia but is eyeing expansion to Hong Kong, Taiwan and New Zealand. (Small Caps, 5/28/20)

    U.S. ice cream maker Turkey Hill acquired Yarnell Ice Cream’s Searcy, Ark., ice cream and frozen novelty facility from Yarnell owner Schulze & Burch Biscuit Co. . . . French retail giant Carrefour purchased the Wellcome Taiwan convenience-store chain from Hong Kong-based retailer Dairy Farm International. The deal makes Carrefour the No. 2 c-store chain in Taiwan. (DairyReporter.com, 6/4/20; Reuters, 6/2/20)

    Polish dairy Mlekovita reported that its first quarter export volume rose 30%, with value reaching $100 million. The company says it ships 5,000 tons of milk powder a month to Algeria . . . UK dairy group Meadow Foods is investing £4 million (about US$5 million) to add manufacturing capacity for plant-based products to its Chester, UK, facility. The product line will include alternatives to milk, yogurt, cream and custard. Meadow expects to start commercial production by the end of the year . . . U.S.-based Univar Solutions signed a deal to distribute lactose-free milk powders from Finland’s Valio to more than a dozen European countries. (FoodBev.com, 6/1/20, 5/29/20; Dairy News, 5/29/20)

    Dairy Farmers of America sold its Chestnut Labs food safety solutions business to Chicago-based Mérieux NutriSciences. Chestnut has operations in Springfield, Mo., and Ithaca, N.Y. . . . Nestlé Health Science acquired a majority stake in Illinois-based collagen protein specialist Vital Proteins . . . Chr. Hansen paid $530 million for probiotics producer UAS Laboratories. UAS was owned by Lakeview Equity Partners . . . The European Commission approved Elanco Animal Health’s pending acquisition of Bayer’s animal health business. Elanco expects to close the deal by early August. (Company reports; FoodBev.com, 6/10/20; Agriland, 6/8/20)

    New Dairy Opco, a new entity formed by investment firms Capitol Peak Partners and KKR, won the auction to buy Borden Dairy out of bankruptcy. Capitol is led by Gregg Engles, former chairman and CEO of Dean Foods. KKR took Borden private in the 1990s, selling off many of its brands in subsequent years, and was a major lender to the company prior to the bankruptcy filing. Laguna Dairy, a subsidiary of Mexico’s Grupo Lala, is still the majority owner of Borden. A U.S. Bankruptcy Court must still approve the deal. (cfo.com, 6/16/20; Wall Street Journal, 6/15/20)

    Vertically-integrated Australian dairy processor Beston Global Food sold its dairy farm operations to Australia’s Aurora Dairies for A$40 million (about US$28 million). Beston plans to use the proceeds to reduce debt, upgrade its plant operations and enhance margins by focusing on a product mix of mozzarella and lactoferrin. Under the terms of the deal, Aurora will supply Beston with raw milk from the farms for the next 10 years. (DairyReporter.com, 6/15/20)

    Netherlands-based Upfield Group is spending €50 million (about US$56 million) to build a new R&D facility in Wageningen, Netherlands, to develop plant-based dairy alternatives. The company, which manufactures plant-based cheese alternatives and spreads, expects to open the lab before the end of 2021 . . . The UAE’s Koita Foods plans to begin exporting lactose-free dairy products, organic milk and plant-based dairy alternatives to the Asia-Pacific region, starting with Singapore and South Korea in August . . . Qatari dairy Baldana is adding a UHT production line capable of processing 170,000 liters per day. The company, which already ships to Oman, Afghanistan and Yemen, plans to extend its regional footprint into additional export markets with long-life products (USDEC Southeast Asia office; USDEC Middle East office; Food Business News, 6/11/20)

    Crystal Farms’ Cheese Wraps won the “best cheese” and the “best manufacturing/technology innovation” categories in the World Dairy Innovation Awards 2020 sponsored by FoodBev Media. Crystal Farms is based in Lake Mills, Wisconsin. The World Dairy Innovation Awards included 20 categories overall, with a judging panel of nine dairy industry experts considering 245 entries from 12 countries. (FoodBev Media, 6/16/20)

    New Zealand’s Fonterra said it would pay up to 10 cents per kilogram of milk solids from the June 2021 dairy season to farms that meet its sustainability and value targets.(Reuters, 6/22/20)

    Vinamik has become the first Vietnamese dairy enterprise licensed to export dairy products to the Eurasian Economic Union, which includes Russia and various countries in Eastern Europe, Central Asia and Western Asia … General Mills has launched a regenerative pilot project on three dairy farms in western Michigan, which requires a holistic approach to managing land, cows and manure. Regenerative practices help increase water infiltration, improve nutrient cycling and reduce soil erosion … New Zealand’s a2 Milk Co. has fueled speculation that it is in the running to buy the Mataura Valley Milk company, also in New Zealand … Italy’s Parmalat is to launch an e-commerce offering after what it describes as the “unprecedented growth” of online shopping during the COVID-19 period. (Saigon Online, 6/20/20; Dairy Reporter, 6/18/20; Inside FMCG, 6/22/20; just-food.com, 6/22/20) 


    Mark O'Keefe is vice president of editorial services at the U.S. Dairy Export Council.

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    The U.S. Dairy Export Council fosters collaborative industry partnerships with processors, trading companies and others to enhance global demand for U.S. dairy products and ingredients. USDEC is primarily supported by Dairy Management Inc. through the dairy farmer checkoff. How to republish this post.  

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