Chinese demand for infant formula predicted to continue to grow
The Chinese demand for infant formula is predicted to continue to grow, despite recent tightening of regulations by the Chinese authorities in recent months.
Kerry CEO Stan McCarthy said the Chinese infant formula market continues to be in growth mode, but the country is also determined to regulation the business of infant formula and ensure there is a credible supply into the market. “And we have to take it the view that they will be successful with this.”
Regulations around pricing and the approval of plants and brands have all come to the fore in recent months and years as the Chinese market has been hit with a number of scandals around baby formula, from contamination of product to cheaper infant formula being packaged as high end branded products.
Announcing the Group’s interim results, McCarthy said such regulatory changes would provide opportunities for Kerry.
The Chinese baby formula market, he said, has to date returned double digit growth for Kerry.
Future growth in the Chinese market, McCarthy said will be helped by the relaxation of the Chinese one-child policy, which in itself will continue to drive growth.
He also said that Kerry is investing in other technologies within the infant formula sector, including products that contain wellmune – a food ingredient from Kerry designed to improve the immune system.
Kerry recently announced Group revenue of €3 billion, which it said reflected a 3.2% business volume growth.