China-NZ launch dairy exchange center

The China-New Zealand Dairy Exchange Center was established Wednesday in Beijing in a bid to bring advanced dairy technology to China.

The exchange center comes at a time when New Zealand Prime Minister John Key is paying a three-day visit in China that started Tuesday.

The exchange center, founded by China Dairy Research System under the Ministry of Agriculture (MOA) and key representatives of the New Zealand dairy industry headed by Fonterra Co-Operative Group, will organize dairy forums and provide training for China's dairy industry practitioners.

To show support for New Zealand's dairy products, Prime Minister John Key and Trade Minister Tim Groser also presented at the signing ceremony of the exchange center.

"We hope to bring in advanced dairy technology to China via the platform of this exchange center," Wang Yachun, a scientist at the MOA's China Dairy Research System, told the Global Times Wednesday.

China imported around 686,000 tons of milk powder from New Zealand in 2013, up 38.6 percent year-on-year, MOA official Yang Zhenhai said at the press conference.

As a leading global dairy producer, Fonterra alone produces 2 million tons of dairy products each year, and its exports account for one-third of the global dairy trade, media said.

Experts noted that one major task for the New Zealand visiting delegation to China is to restore Chinese consumers' confidence in their dairy products.

Fonterra's products were reported to contain the harmful clostridium botulinum in August 2013, though later tests showed that it did not contain the bacteria. Despite this, Fonterra's image was still greatly tarnished.

Chinese consumers still see New Zealand food products as carrying a greater food safety risk than foods imported from many other countries, according to a survey by New Zealand's Massey University carried out in Lanzhou, capital of Northwest China's Gansu Province, Xinhua reported Wednesday.

Song Liang, a dairy analyst at Beijing-based Distribution Productivity Promotion Center of China Commerce, also noted that consumers' confidence in New Zealand's dairy products is not likely to fully recover in the short term.

Song noted that China imports around 80 percent of its dairy products from New Zealand at present, but in the future, "it must be diversified, in a bid to guarantee supply and stabilize the prices."

Fonterra announced last week increases in prices for buttermilk and protein, which has prompted speculation that prices for dairy ingredients will be bumped up in the global market, given the company's leading position.

When asked by the Global Times at the press conference whether the company will further bump up prices, John Wilson, chairman of Fonterra, said that the global dairy market is "volatile" but "very transparent."

"For a very long time we have relied too much on New Zealand and Australia for dairy products, and neglected other places, such as Europe and America, which could also be important sources," Song said.