Swiss food giant Nestlé has announced a RMB 2.5 billion investment in China’s milk district.
The mayor of Shuangcheng, Mao Chen, and Nestlé’s director of Production Technology for the Greater China Region, Zhan Yudong, have signed a memorandum of understanding to jointly develop modern dairy farming in the milk district.
The aim of the agreement is to ensure the district becomes China’s benchmark for best practice in dairy farming and management, Nestlé said.
The district in Heilongjiang province, north-eastern China, is already Nestlé's largest fresh milk supply base in the country.
Under the terms of the agreement, a total investment of RMB 2.5 billion will be made in the milk district over the next five years through a partnership between Nestlé, the local government, investors and farmers. The partnership will aim to promote high quality and efficient dairy farming methods using modern technology and professional knowledge.
The agreement is designed to help all farmers working alone or on small farms in the milk district to be relocated to professionally managed dairy farms or large scale pastures; and to help those who own larger farms to scale up their facilities and use more modern practices, Nestlé said. To this end, the company and the government have invested RMB 10 million to purchase 1,000 sets of milking machines.
A new dairy farming institute will also be created in Shuangcheng. With a series of training farms, the institute will aim to become the country’s leading dairy training centre, offering teaching courses from national and international experts.
Commenting, chairman and CEO of Nestlé China Roland Decorvet, said: “The plan will continue to make Shuangcheng the nation's benchmark for high quality and reliable fresh milk. It also underscores Nestlé's commitment to grow its dairy business in China in a long-term and sustainable way.”
Nestlé built a factory in Shuangcheng in 1987. Over the years, the company has provided credit guarantees to those farmers with the potential to grow their businesses.
