There’s no greater demonstration of the rise in China’s middle class and its appetite for Australian dairy than the price being paid for fresh milk hitting the Chinese market for the first time.
Northern NSW dairy cooperative Norco sold 4000 litres of fresh milk in Shanghai in just 36 hours, despite the milk costing nearly $8 a litre.
Norco chairman Greg McNamara said the response to the fresh milk was “phenomenal” and the Lismore-based farmer co-op is now looking at exporting between 20 and 50 million litres of milk, worth $400 million at the retail level, over the next 12 months.
McNamara said the co-op hatched a plan two years ago to target the Chinese market, focussing on faster quarantine clearance to make the perishable product viable.
The milk is bottled at a factory in Raleigh on the NSW mid north coast, then air-freighted from Sydney. It’s in China within 48 hours of milking.
“The response was amazing,” McNamara said. “Our concern was: are they used to drinking UHT or would they like our milk? The response was better than we imagined.
“Provenance is important to Chinese consumers and they want to buy from organisation with long history . We could see really do have an interest in Norco and want to see it’s owned by farmers,” he said.
China is Australia’s 2nd largest market for mostly long life milk, accounting for 20 per cent of total milk and cream exports.
Around 40 per cent of milk production is exported.
Agriculture minister Barnaby Joyce said that with potential retail prices of between $7 and $9 per litre, the the Norco deal is a major boost for northern NSW and Queensland dairy farmers
“We hope that this is the first of many new opportunities for Australia’s fresh milk products to gain access to the expanding Chinese market and I commend Norco for their great work in seeing this through,” he said.
Mr McNamara said Asia will be a major focus for Norco, in addition to recent deal with Coles, which will see 30% of the co-op’s supply going to the supermarket giant as fresh milk and ice cream from July 1.
The company currently produces around 150 million litres of milk per year from 159 coop members.
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