Yili to establish northern China's largest dairy base in Binhai

Yili Group, China's second largest dairy producer by sales in 2008, plans to set up a dairy factory in Binhai New Area, which aims to be the largest dairy producer in northern China.

Being the leading company of the dairy industry, Inner Mongolia Yili Industrial Group was also the sole dairy sponsor for the 2008 Beijing Olympics. In late May of this year, the company announced that it had been appointed by the Shanghai World Expo Business Coordination Bureau as the only dairy sponsor for the 2010 event.

This will be Yili Group's first expansion project following its involvement in last year's melamine-tainted milk scandal which dealt a devastating blow to China's dairy industry. With this expansion, analysts said it is a sign of recovery for the country's dairy industry.

Scheduled to be located in Tianjin's Binhai Bonded Area, the new factory being planned will have a first stage investment of up to RMB300 million (US$43.9 million). Meanwhile, Yili Group's raw milk base will be supplying the raw milk for the production of dairy products in the factory. Upon its completion, the Binhai factory will be a major production base for providing dairy products to northern China's markets.

Since last year's scandal, Yili is strengthening its efforts on quality control.

To ensure the quality of Yili's dairy products, the company will hasten the construction of raw milk bases and strengthen its monitoring of milk stations, according to Zhang Jianqiu, CEO of Yili Group.