Ekosem-Agrar grows dairy exports to China

By Jim Cornall contact

- Last updated on GMT

The company plans to use rail freight transport to significantly reduce delivery times.  Pic: Ekosem-Agrar
The company plans to use rail freight transport to significantly reduce delivery times. Pic: Ekosem-Agrar

Related tags: Ekosem-Agrar, Russia, Milk, China, Milk powder, Infant formula

Ekosem-Agrar Group is expanding the export of its Russian dairy products to neighboring China.

Since the beginning of 2021, three containers with a total of around 70 tons of EkoNiva UHT milk have been shipped, which already corresponds to the total volume exported to China during the whole of the previous year.

Following the first deliveries, more extensive contracts have now been concluded with Chinese wholesalers.

The first confirmed orders for UHT milk in the 3.2% and 3.5% fat grades comprise 13 containers with a total of approximately 295 tons, which are to be shipped to the ports of Dalian, Shanghai, Tianjin and Nansha by mid-May. Through this, Ekosem-Agrar Group is expanding the presence of its products to the entire east coast of China. The first shipment of EkoNiva dairy products, which took place in August 2020, only reached several cities in northeast China.

The Chinese customers are both retail companies and customers from the food service industry. The conclusion of further contracts and the placement of additional orders are expected in the coming months.

While the Russian population currently comprises around 147m people, China is home to around 1.4bn people. However, the natural resources for the production of agricultural commodities in China are comparatively small. While the ratio of agricultural land to population (in hectares per inhabitant) in Russia amounts to 0.85, China only has a ratio of 0.09. In addition, although the annual per capita consumption of milk in China has risen from 18kg in 2007 to more than 36kg in 2018, this still only corresponds to one third of the global average.

Stefan Dürr, chairman of the management board of Ekosem-Agrar AG, said, “We see a highly attractive, unsaturated sales market in a favorable location in our neighboring country of China and are very pleased that our EkoNiva dairy products are meeting with high demand there. For the near future, we expect to be able to increase our monthly deliveries to up to 50 containers with a total volume of more than 1,000 tons."

EkoNiva UHT milk is still delivered exclusively by sea, as this is, among other factors, more cost-effective than the overland route. However, in order to be able to supply fresh dairy products to China in the future, preparations are under way to include rail freight transport, which would significantly reduce delivery times.

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