Guys Set out below is an article published in academia in June on Chinese consumers perceptions of food safety risk Domestic infant formula versus imported infant formula. Overwhelmingly Chines consumers percieve the risk of food safety with domestic producers to be much much higher than that applying to imported formula brands. Moreover Chinese producers are still not at 60% market share for infant formula. Now it stands to reason if you think about it that Feihe is suffering a2's daigou problem in reverse, that is throughout the lockdowns and the first two phases of covid there would have been severe restrictions on international producers being able to get their product into China. This would have opened the market up for Feihe and lead to rapid growth because of the reduction in competition.
With the opening up again in the last six months and the removal of impediments to sales for international producers competition would have returned with a vengence cutting into Feihes sales. Moreover recent data from CMB shown that Feihes selling costs are more than double that of A2's
A2M Price at posting:
$4.38 Sentiment: Buy Disclosure: Held
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