August 27, 2011

 

CP-Meiji sets 2013 budget for dairy plant capacity expansion

 

 

CP-Meiji announced on August 25 that it would spend THB2 billion (US$66.89 million) by 2013 on the capacity expansion of its dairy complex in Saraburi's Muak Lek district to boost its stake in local and foreign markets.

 

The expansion is in line with the company's five-year plan to double its sales to THB8 billion from the THB4.1 billion (US$137.11 million) targeted for this year.

 

President Prasit Boondoungprasert said the Muak Lek expansion would be done in three phases related to different products, starting from cultured yoghurt, cup yoghurt and pasteurised milk.

 

He said the Muak Lek plant currently used about 220 tonnes of raw milk per day and that should be doubled to about 400 tonnes in the next five years.

 

"We have sent a team of experts to help our contracted dairy farmers so they will be able to raise their raw-milk production and be able to meet our demands as well as comply with our expansion plans in the future," Prasit said.

 

He added that Thai consumers were becoming more health-conscious, and the government's policy to increase the minimum wage to THB300 (US$10.03) would benefit the dairy market as consumption would increase.

 

Apart from continuous growth domestically, the company plans to enter potential markets such as Hong Kong.

 

"We see Hong Kong as a very attractive market with few competitors. People there have high income and per capita consumption of dairy products is between 40 and 50 litres per annum, compared with just 14 litres in Thailand," Prasit explained.

 

Meiji, hoping to launch its products in Hong Kong by the end of this year, has applied for approval from the Food and Drug Administration.

 

The company hopes to enter Malaysia by next year and is conducting a feasibility study to set up a dairy plant in Vietnam, Prasit said.

 

He added that Meiji had had a stake in the Singapore market for the past 10 years.

 

"The fresh-milk market in Singapore is quite tough because it is shared by more than 10 international brands, including from the US, Australia, New Zealand and Indonesia. Meiji, however, is the leading fresh-milk brand with a 34% share," he said.

 

CP-Meiji expects THB4.1 billion (US$137.11 million) in overall sales this year, up from THB3.7 billion (US$123.74 million) last year, and enjoyed 15% sales growth in the first six months.