China's Feihe invests 234 million U.S. dollars in Canada's agri-food

Updated 2017-08-09 14:10:39 Xinhua

Feihe International Inc., a top manufacturer of infant formula in China, is building a manufacturing plant valued 300 million Canadian dollars (234 million U.S. dollars) in Kingston, Canada.

Leng Youbin, Chairman of Feihe International Inc. told Xinhua on Tuesday in Ottawa that Feihe board decided to invest to set up the plant in Kington city in Ontario province "because of better natural and cultural environments."

"We inspected many places, including some in the U.S. and other parts of Canada, and came to conclusion that Kingston is very good place for production," Leng said.

Xia Xiang, Economic and Commercial Counselor of Chinese Embassy in Ottawa, said this would be China's biggest investment in Canada's agri-food sector so far and it is also Canada's largest-ever foreign investment in the field.

According to Xia, Canada hasn't made its own baby formula for more than 20 years. The Canadian Dairy Commission tried for a couple of years to find a domestic processor, but no Canadian processors were interested in expanding into formula.

The Canada Dairy Commision then broadened its search to European and Asian companies. Up to April 2016, it found its fit in Feihe: a manufacturer with over 50 years of experience and keen to expand to North America. Since then everything moves very fast and the agreement on the plant was signed by Feihe and Kingston City Hall in December 2016.

Feihe has been in the infant formula industry since 1954 and has six manufacuring facilities in China.

Feihe's new plant is in corporation with Canada Royal Milk, so it can access the same government funding available to domestic processors.

Feihe has been approved for two federal programs: the milk access for growth program, which allows it to buy milk, and a matching investment fund, which offers non-repayable contributions to companies that innovate.

Feihe's new plant is located in the Cataraqui Estates Business Park in Kingston. It has been under construction since June this year and is expected to be fully operational in late 2019. Some 20 percent of the plant's products will stay in North America, with the rest exporting to China.

"It will be Canada's first and only wet infant formula facility and North America's first and only goat milk infant formula manufacturer. It will manufacture up to 60,000 tons of dry infant food annually, using milk from Canadian farms," Leng said.

Xia believed the new plant will be one of the most technologically advanced infant formula manufacturing factories in the world, utilizing a wet blending process to produce high quality infant formula.

Leng also said that the construction of the plant is estimated to create some 1,000 job opportunities. When it is put into production, it is expected to create more than 200 full-time jobs, said Leng.

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