Home > Overseas Investment News > A winning formula? China invests in Canadian dairy to help feed its baby boom
A winning formula? China invests in Canadian dairy to help feed its baby boom
2017-08-07
Brief:Feihe International investing $225 million to build infant formula plant in Kingston, Ont.
Kingston Mayor Bryan Paterson visited the Feihe production facility in Heilongjiang province in northeastern China last January. (Office of Mayor Bryan Paterson)
 
Feihe International Inc.'s future baby formula plant is now under construction on a 40-acre site in Kingston, Ont.'s Cataraqui Estates Business Park. (Feihe International Inc.)
 
Donald Trump called Canada's supply-managed dairy sector a "disgrace."
 
Indeed, Canada's strict system of production quotas, import restrictions and price and quality controls is a perennial target for free traders.
 
But guess who likes it? The biggest market Canada is wooing right now: China.
 
Supply management is a big reason why a Chinese corporation is investing an unprecedented $225 million in eastern Ontario. Feihe International, Inc. wants cows. Goats, too. Lots of them.
 
That's because as China's one-child policy phases out, it's going to need a lot of baby formula.
 
"It's one of the largest economic development projects in our city's history," said Kingston, Ont., mayor Bryan Paterson, calling Canada's largest-ever foreign investment in agri-food "off the charts." +
 
"It might be out of the ordinary, but I think that's what was most exciting."
 
The first concrete trucks are already pouring at the future site of a 28,000-square-metre infant formula plant. When the state-of-the-art facility opens in 2019, it will employ over 200 people in manufacturing and research jobs. Over a thousand more could come from its construction and eventual supply chains.
 
 
A small team of Chinese managers have moved to Kingston. Everyone else will be local.
 
Last winter, Feihe brought the mayor and a delegation from Kingston over to northeastern China for a tour of its factories and farms. Paterson was struck by how geographically similar it was to eastern Ontario. With one big difference: scale.
 
A "typical rural village" they visited was three times the size of Kingston, he said.
 
"When you have millions and millions of babies, you need to be able to manufacture a lot of infant baby formula."
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