In the past 11 months, Swiss food giant Nestlé has invested over 1 billion yuan to expand its pet food production in Tianjin, China.
Nestlé recently increased its investment of over 730 million yuan ($ 112 million) in May 2020 by 230 million yuan ($ 35.1 million) in a two-step upgrade of its pet food plant in Tianjin Economic-Technological Development Area (TEDA.) To support).
Gradual expansion plan
The first phase aims to increase the production of the pet food factory with high quality prescription grain production facilities. It will be the company’s first such facility in China, Oceania and Africa and the fourth worldwide, Nestlé said. In addition to prescription pet foods, the first phase will also focus on the development and production of premium pet foods that improve existing recipes and introduce new feed options. Phase 1 production is scheduled to begin at the end of 2021.
In the second phase, which will take place in the first quarter of 2023, a new canning line for pet food will be built, which will produce tailor-made high-end wet canning for the local Chinese pet market. During this time, Nestlé’s total investment in TEDA will also be used to improve the logistics, cost and design of the mills and invest in smart storage facilities to reduce CO2 emissions in the mills and to free up additional land for the wet feed mill acquire.
Nestlé’s aggressive expansion in Tianjin reflects the company’s long-term commitment and confidence in China, where pet ownership has been growing steadily for years. China is Nestlé’s second largest market in the world.
“Over the past seven years we have achieved high double-digit growth in our pet food business in China and we are committed to continuously improving the consumption of pet food,” said Mirand Chan, Head of Nestlé Purina PetCare in Greater China. “The market has shown an increasing demand for high quality pet food in terms of raw materials, nutrients and taste. Our new investments will help deliver the best products to our consumers. ”
International investment in pet food is increasing in China
However, Nestlé is not alone in its quest to strengthen its presence in China. Pet food competitor Mars Petcare is also building a pet food factory within TEDA after announcing a $ 100 million investment in December 2020. Mars Tianjin Pet Food Factory will cover an area of approximately 110,000 square meters and achieve an annual output of more than 250,000 tons.
According to Economic Daily China, China welcomed 570 new foreign-invested companies to Tianjin in 2020 with contractual foreign investment of $ 36.248 billion, up 14.7% year over year.
China, now the second largest economy in the world, posted 18.3% year-on-year GDP growth in the first quarter of 2021, the strongest GDP growth since records began in 1992. The growth is due to increases in retail sales, industrial production and investment in property, plant and equipment.
Alma Buelva is a journalist from the Philippines. When she’s not writing about business and technology, she devotes her time to caring for and writing animals.
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