On 27 July, Taiwan's Uni-President China
Holdings Ltd. (Uni-President) used its official WeChat platform to notify
customers of a “50% discount for having an early taste” of Westgold UHT - as a
result, up to 31 July it was sold for RMB99/250ml*24 cartons instead of
RMB199/250ml.
Source: Baidu
The marketing wording tells consumers that the product is imported from New
Zealand in original packing - “The cows are grazed and the protein content of
the milk is 3.3 g. It is from Westland Co-operative Dairy Company Limited
(Westland) on the western coast of New Zealand.” Westland is owned by 425
farmer shareholders and processes about 4% of New Zealand's milk - its role in
China has largely been as a supplier of raw materials such as base powder,
commodities, lactoferrin etc.
Westland penetrated into Chinese market
with its Westgold
In April, Westland confirmed the start-up of its UHT milk/ butter plant in
Rolleston, just outside Christchurch, reportedly based on an investment of
USD28.6 million (NZD40 million, USD/NZD exchange rate @ 1.3968 on 4 August,
sourced on hexun.com) - production capacity was given at 14,000 L/h, and this
paved the way for the launch of its products onto the Chinese market in June.
“The plant will enable us to reduce our commodities business which faces great
fluctuations and is now facing oversupply. Now we are focusing on manufacturing
high added value products for premium market segments and for high profits.”
stated Westland’s CEO at that time: “The Chinese middle class is now growing.
They are well educated, having considerable disposable incomes and high
requirements regarding the quality and safety of dairy products.”
In May the company took the opportunity of Bakery China 2016 (Shanghai, 11-14
May) to launch its “Westgold” brand - this activity focused on the brand only,
not specific products, but the indicated focus was on whipped cream, butter and
UHT milk. “The brand launch signals that we are making a significant step into
the Chinese market,” stated a manager of Westland in China, “....based on our
already established image as a raw materials supplier.”
Much of the focus should be on foodservice
- our research shows clear demand amongst customers in this channel. In respect
of B2C sales, however, its whipped cream is currently only marketed on
Taobao.com, by just 6 online stores at a price of about RMB32/1L – the figure
for transactions shown within 30 days was only 1! Moreover its butter has yet
to appear – apart from an unsalted butter on YHD.com priced at RMB25/250g.
The UHT milk launched by Uni-President lacks really distinctive reasons for
consumers to buy it - its protein content is similar to other imported ones,
and a claim for grass-fed production based on 5 generations of farming knowhow
may not be sufficiently persuasive for consumers. Another concern must be that
the online mall on WeChat is a very limited sales platform compared to
Taobao.com - it could take a long time to build a consumer following on this
medium.
Westgold UHT milk
Source: Uni-President China Holdings Ltd.
Westgold whipped cream
Source: Taobao.com
Westgold unsalted butter
Source: YHD.com
This article comes from Dairy Products China News 1608, CCM
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Tag: dairy