Article today about KTD and China. Im a big dairy bull but I...

Article today about KTD and China. Im a big dairy bull but I think management have taken a good insurance policy by diversifying into different markets including Australia so that we don't take a beating ftom China regulation. It's possibly not the best decision profit wise but it'll seem a smart move if things go pear-shaped with China in the future.

Dairy

Both the milk and cream processing sector and the milk powder industry are “highly vulnerable” to hefty Chinese tariffs.

ASX-listed companies like A2 Milk Company Ltd (ASX: A2M), Bega Cheese Ltd (ASX: BGA) and Keytone Dairy Corporation Ltd (ASX: KTD) could see their stock prices sink if that happened.

Harrison said slugging dairy would mean trade hostilities have stepped up to a very severe level.

“Australian dairy products are highly popular, and there are few substitute markets for baby formula that Chinese parents are willing to trust,” he said.

“Action against this market would likely cause significant backlash from Chinese consumers, and could result in weakened support for continuing trade restrictions against Australia.”

Australian baby powder exports skyrocketed during the COVID-19 pandemic, to reach 18,726 tonnes year-to-date to the end of September.