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Wednesday
Jul222015

Food for Thought!

The following article appeared this week in the UK Farmers Weekly: 

"China has begun work on the construction of a 100,000-cow dairy unit to supply the Russian market with milk and cheese.

“The scale of Chinese investment in dairy production is vast. 

“I wonder now whether we will ever get the Russian milk market back.”

 Mansel Raymond

Copa-Cogeca

The site in Mudanjiang City, northeast China, is the world’s largest and marks a 1 billion yuan (£103m) collaboration between Russian and Chinese investors.

China’s Zhongding Dairy Farming and Russia’s Severny Bur are behind the project.

The world’s largest operational dairy site is the 40,000-cow Modern Dairy Company unit in China.

For the new site, feed and forage stocks needed to supply the year-round housed animals will be grown on 100,000ha of land, most of which is in Russia.

A further 200,000ha of farmland has been earmarked to supply feed once the project is on stream.

The construction began as Russia looked to secure suppliers of dairy products beyond the European Union.

Earlier this year Brussels said it had extended economic sanctions because of Russia’s involvement in the war in Ukraine.

In a tit-for-tat response the Kremlin prolonged its ban on various food imports from the EU, United States, Australia, Norway and Canada, including milk and milk products until August 2016.

Before the Russian ban the EU exported about 300,000t of cheese, roughly 25% of its production."

Mansel Raymond, chairman of the Milk Working Party of Copa-Cogeca, the umbrella organisation for European agricultural groups, said the ban and the Chinese-Russian dairy venture sent a worrying signal to EU dairy farmers.

“The scale of Chinese investment in dairy production is vast. 

“I wonder now whether we will ever get the Russian milk market back,” Raymond said.

“Building a 100,000-cow dairy farm is simply mind-boggling. 

“If the project goes ahead and the 100,000 head represents milking cows. This unit alone could produce 800m litres/year.

“In that case, it would equate to 100,000t of cheese – and that would mean this unit alone could produce about 30% of our previous exports to Russia,” Raymond said.

Never mind the UK and European industry - it really does make you wonder whether or not our industry has been taken for a total ride on the Black & White back as we have busily exported our best stock lines to China over the last few years.   

I would like to say that there is reason for confidence of an eventual recovery of our dairy prices, but all the indications are otherwise, and Fonterra's silence speaks volumes - surely they simply cannot be unaware of the intelligence on the international trade - can they?

This is perhaps just the beginning, and bleating about the superiority of grass-fed production is not going to change anything. It does look ominous - there are national interests at work here about which we appear barely aware.

 

 

 

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