Dutch dairy companies' quest for new growth pastures leads them to China

"The trend is that Chinese companies are increasingly casting their eyes towards Europe, which is removing the ceiling on production," he said.

Hart said the company was encouraged by comments by President Xi Jinping during his visit to the Netherlands in March. Xi said China would encourage the imports of dairy products from the European country.

Meanwhile, the company has already taken a string of measures to consolidate its market presence in China.

Friesland Campina has been holding talks with Shenyang-based China Huishan Dairy Holdings on creating a joint venture to produce, market and sell infant formula.

It also has helped to establish the Sino-Dutch Dairy Development Center at the China Agricultural University together with Wageningen University in the Netherlands, which Hart hopes will further enhance the sharing of Dutch expertise in the dairy industry.

The company will reportedly invest 40 million yuan ($6.5 million) over the next three years in the development center. It also plans to build a farm in Beijing to enable more dairy farmers to learn the Dutch mode of dairy farming.

However, Song warned that it is unlikely that China will totally borrow the Netherlands system.

"In the Netherlands, dairy farms came before the milk plants, while in China it was the opposite. It is impossible to organize the Chinese dairy industry the way the Netherlands does," he said.

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