Beingmate are one of the largest global manufacturers of baby infant formula in the world. In 2013 it set up its first overseas subsidiary in Cork following the signing of a memorandum of strategic partnership with Kerry. Kerry has been one of the top suppliers to Beingmate for many years.

According to our agribusiness editor Eoin Lowry, in the last year Beingmate Ireland has seen a threefold increase in Irish turnover as revenues increased from €9.5m to €33m in 2015. The Irish limited company spent €31.8m purchasing mainly ingredients for infant formula.

The large New Zealand dairy company Fonterra also has a partnership with Beingmate in China. Recently, it invested almost $500m to buy an 18% share in Beingmate as a route into the Chinese infant nutrition market.

The recent development between Kerry plc and Beingmate means infant formula is now produced, canned and packaged in Charleville. This is the first such arrangement in Ireland. It should be viewed as a very positive move in terms of adding value to Irish dairy ingredients.

There have been mixed reports of how successful the arrangement has been since it started, with some industry sources suggesting it wasn’t going so well and that much smaller volumes of product than anticipated were developed. However, other sources have said teething problems for any such significant investment are to be expected and with time it would increase capacity and be a highly successful venture.

Unexpectedly, just as the new arrangement was getting established in Charleville, Beingmate announced that Fonterra had taken an almost 20% ownership stake in the Chinese business. When this was announced there were some concerns about the future of the Kerry-Beingmate partnership, as some felt the New Zealanders would dominate supply into the company, pushing out the Kerry/Irish product.

While in Beijing, the Irish Farmers Journal had the opportunity to sit down with the CEO of Beingmate, Tao Huang. We started off by discussing how the company sources milk globally and if stronger links with New Zealand and Fonterra would push out Irish supply. He said: “There are two golden areas for producing dairy products globally – one is Ireland in the northern hemisphere and the other is New Zealand and Australia in the southern hemisphere. This geographical spread where seasons are the opposite makes it a perfect supply season for Beingmate and balances out our powder requirements.”

Chinese takeover

With rumours Chinese investors have purchased 5% of the entire land area of Ukraine and Chinese investors purchasing controlling stakes in New Zealand farmland and milk processing facilities, the Irish Farmers Journal asked the Beingmate boss if the company was considering investment in further processing or maybe even farmland in Ireland? He said: “In terms of processing plants in Ireland, Beingmate is already co-operating in Kerry and has an investment in Charleville, but, for farms it’s better to leave the Irish farmers to work and own their business.”

Asked about further investment in the new infant formula production and canning facility in Kerry, he said: “Actually, Beingmate has already been discussing with Kerry about upgrading or enlarging the plant in Charleville and if an arrangement can be reached with Kerry then yes they would be more than happy to invest more in Ireland.”

The Chinese population is still growing and, with an increase of 3m babies predicted, soon there will be an estimated 19m babies born each year in China. Imported product (such as that produced in Charleville) attains a price premium on native (home-produced) powder.

Asked about Origin Green and how it was possible to get Chinese consumers to recognise Irish product, Huang said he was willing to invest in Origin Green and the ‘Green +’ brand they own and promote. He said Chinese consumers understand the clean green image.

Huang said,: “Beingmate is a mid- to high-end brand and consumers are from tier one to tier three cities and hence they have recognition of green, sustainability and natural concepts and more will be aware of this in the future.”