World-leading food and beverage giant Nestlé announced its plan to invest CHF 100 million ($103.7 million) in its factories in Tianjin, China, on May 20th, which aims to further strengthen its footprint in China, and enhance its product portfolio [1].
Significant capacity expansion of existing pet food plant
The pet ownership rate in China in 2019 increased by 8.4%, pet food dominates the pet care industry accounting for 61.4% of all revenue, with a y-o-y increase of 9.2%, as disclosed in the Chinese Pet Industry White Paper [2].
Chen Meien, head of Nestle’s Purina pet food in greater China, said, "Purina has maintained a high growth rate in the past five years, which was over 50%. Chinese consumers have shown a rising interest in raising pets, and they are increasingly looking for more specific solutions for pets like immunity enhancement.” "We also see a rapid increase in wet cat food demand, so we decided to introduce new product lines offering pet owners quality products in categories," Chen added.
The first production facility in Asia for plant-based products
“Plant-based products garner huge attention globally. We think China is a market full of potential in this segment as it has a long history of eating plant protein foods like Tofu,” said Rashid Qureshi, chairman, and CEO of Nestlé Greater China. He also mentioned Nestle already rolled out some plant-based products like sausages in Europe and North American, which have been well received consumers. The production line with a designed annual capacity of 8,000 tonnes will be Nestle's first of its kind in Asia.
At ChemLinked, we have noticed that several brands, including Starbucks, KFC, and HeyTea, have all launched plant-based products in China this year. Danone also introduced its plant-based protein powder VEGA ONE [3] to China via Cross border e-commerce on May 18th.
In addition, Nestlé plans to use some of the capital to upgrade its Chengzhen Wafer line. It also plans to develop its Tianjin Nestlé Quality Assurance Centre to further enhance the laboratory’s ability in quality testing and monitoring food products.
The announcement closely follows the launch of NesQino [4] in the country, a healthy drink made from 100 percent natural ingredients to attract health-conscious consumers. As Qureshi said, Nestlé’s increase in its investments in China is a clear demonstration of its long-term commitment and confidence in the country.
*Disclaimer: all images are from the internet.
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