October 9, 2007

Rise in milk powder exports from China's Xinjiang

Milk powder exports from China's Xinjiang to countries in Africa and Central Europe had increased significantly amid reduced supplies from drought-affected Australia.

According to the Urumqi Customs Office, Xinjiang Uyghur Autonomous Region had exported more than 200 tonnes of skim milk power and full cream milk powder in first nine months of this year. In particular, exports of full cream milk powder had increased 48.6 percent compared with the same period last year.

Due to increased demand, prices of Xinjiang's skim milk powder and full cream milk powder have risen to RMB 22,000/tonne and 26,000/tonnes respectively in September, up by RMB 8,000 and RMB 10,000 compared with January's.

Market traders mentioned that, in the past years, only Shanghai's Bright Dairy Group had purchased milk powder in Xinjiang, along with a few occasional buyers from Central Asian countries. Their total order usually does not exceed 20 tonnes. 

This year, large dairy companies from Africa, Central Europe as well as domestic companies have placed orders with milk producers in Xinjiang. Demand for Xinjiang's milk powder had exceeded the region's production capacity.

RMB1=US$0.1332 (Oct 9)