August 19, 2011

Beijing Sanyuan Foods Co Ltd planned to invest RMB1 billion (US$156 million) in building its milk source bases this year, with one milk base for a single plant.

The company started construction on its 10,000-head dairy cow base which cost RMB300 million in Shouguang city of Shandong province last month. Besides, it will spend RMB600 million in building its dairy cow base in Dingzhou of Hebei province. The Hebei base mainly provides milk for plants in Shijiazhuang city.

Sanyuan Foods and its parent, Beijing Capital Agribusiness Group bought core assets of Sanlu Group Co Ltd after the melamine scandal. It also established its own marketing network in over 300 cities of the country.

A chief from the Sanyuan Foods says that the company witnesses gradual increase of domestic market share so far and is confident such trend will go on. The company's medium and high-end products currently occupy 25% of the market.