The text and table below summarize the situation. Nestle is a long long way from being a serious competitor
To sell infant formula into China you need to obtain a CCC (China Compulsory Certification). This certification requires an exporter to China like Nestles is required to provide progeny about where the milk comes from, farms locations etc. To claim unsubstantiated in an article that the Nestles Atwo product comes from “milk all over the world” is completely ludicrous and would not be acceptable to the Chinese Government.
My own research with Wyeth Ireland is that the milk comes from a small number of herds and that the capacity is simply not there to export large amounts of the Atwo product to China even in the remote future. That is why the product is only available on Chinese websites and nowhere else.
Wyeth manufacturers 5 other non A2 infant formula Iluma brand products which it does export to China. If Wyeth priced its new product at the same level it would cannibalise its own brands in China. The table below shows you that Wyeth has absolutely no intention of doing that and that Wyeth’s Iluma 2 is simply not competitive on price terms.
View attachment 1037119
Moreover A2 has been eating Wyeth’s lunch as the table on imports of infant formula from Chinese customs shows
According to Chinese Customs, Infant Formula imports for January 2018: (Y-o-Y growth)
- Netherlands 70.16MT down 42.3%
- Germany 29.48MT up 113.2%
- Ireland 23.09MT
down 20.9% (which includes Wyeth Illuma)
- France 15.27MT up 13%
- New Zealand 31.03MT
up 77.1% (16% Market share)
- Australia has 12.375MT or 4.2% of the market share, but I don't have growth number.
Source Price Difference JD Com
Source Distribution Channels Wyeth A2Milk
Source: Herd Numbers and Capacity to Increase Numbers, Irish Dairy Board, Wyeth Ireland
These are the facts to have headlines in the Herald A2 FACES MASSIVE COMPETITION IN CHINA
is completely misleading and damaging and absolutely factually, incorrect and false. I am not an employee of A2 or connected to it in any way except as a private investor concerned about the damage caused by such bull, when on the facts the level of competition is minimal and will remain so for some considerable time because of A2 cow number barriers.
(20min delay)