December 25, 2007

Big jump in dairy exports from China's Inner Mongolia in 2007

Inner Mongolia's export of diary products is set to rise significantly in 2007. For the Jan-Oct period, the autonomous region of China had already exported 22,100 tonnes of dairy products worth US$27.4 million, representing a respective increase of 51.7 percent and 174.5 percent compared with Jan-Oct 2006.

In geographical terms, Hohhot, the region's capital, and the Hulunbei'er region bordering Heilongjiang province, had emerged to become the two major milk and diary production areas in Inner Mongolia.

Dairy products from the Inner Mongolia are now being exported to Saudi Arabia, Oman, Egypt and Mauritania, in addition to Hong Kong, Macau and Singapore.

Market participants attributed the sharp rise in Inner Mongolian dairy exports this year to reduced supplies from major producers such as Australia--where drought had affected production--and New Zealand.

Lower export subsidies by the EU had also caused dairy exports from member countries to decline this year, thus shifting international demand towards non-traditional sources such as China.

RMB1=US$0.1361 (Dec 25)