China has been a destination country for Valio's milk and whey powder exports for a long time. Operations in the country have grown gradually. Since 2008, Valio has had a subsidiary in China – Valio Shanghai Ltd. – which sells and markets quality milk powders for the industrial sector and consumers. Chinese consumers can buy Valio's lactose-free milk powders online.
Quality is Valio Shanghai's trump card
China has been an important destination for Valio's milk and whey powder exports for a long time. The operations have grown gradually. Since 2008, Valio has had a subsidiary in China – Valio Shanghai Ltd. – which sells and markets quality milk powders for the industrial sector and consumers.
Exportation initiated as a result of ministries' development project
In the late 1980s, the Finnish and Chinese ministries of agriculture organised a joint development project with Valio participating in training of local dairy professionals and offering consultative help on construction and commissioning of plants. The contacts forged during the project initiated Valio's exports to China – the first batch of whey powder was delivered to a small dairy owned by the Chinese state in 1991.
According to Valio Shanghai's Commercial Director Kari Finska, that dairy is today the eighth largest dairy company in the world and remains one of Valio's biggest customers in China.
A fulfiller of strict quality requirements
The export of powders continues to be the core of Valio Shanghai's business operations. All of the exported products are made in Valio's Finnish powder plants at Haapavesi, Lapinlahti and Seinäjoki. The subsidiary takes care of local sales, marketing, logistics and relations with officials.
Most of Valio Shanghai's customers are from the baby food industry, which has extremely high quality requirements for its ingredients, based on e.g. taste, composition, microbiological quality, traceability and solubility. In addition to the baby food industry, customers include companies from other food sectors, such as chocolate manufacturers. Valio has a solid position as a valued operator in China; it has met the industry's strict quality requirements well.
A growing consumer market
Competition in China's milk market is fierce. The country is the world's biggest importer of dairy products, with a robustly growing local production. Using milk products is fairly new to Chinese consumers, but it is becoming more common constantly.
“Chinese consumers value quality and safety. Imported products have been considered safer than domestic ones ever since the melamine scandal a little less than ten years ago. Local production is gradually regaining consumers' trust though”, says Kari Finska.
Valio is also keen to meet the growing demand for milk products: lactose-free whey powders for consumers were introduced to the market in the autumn of 2016. Despite the tough competition, there is enough room in the market for both domestic and imported milk products. As in industrial powders, quality is Valio's trump card in consumer products, too.