Infant formula company Synutra to set up drying facility in France

Chinese infant formula producer Synutra has entered into an agreement with Sodiaal, a leading dairy cooperative in France, and its subsidiary Euroserum, a producer of demineralised whey powders, to build a €100m drying facility in Carhaix, France.

Synutra plans to invest €90m in the facility, which will primarily be funded through bank loans, while Sodiaal will invest the remaining amount.

As part of the agreement, Sodiaal and Euroserum will supply high volumes of milk and demineralised whey to the facility.

The drying facility will process these raw materials and produce powdered milk and fat-enriched demineralised whey, which will be used by Synutra to manufacture its infant formula products.

It will have a capacity to produce 60,000t of powder per year initially, with a maximum capacity of up to 100,000t.

Synutra chairman and CEO Liang Zhang said that the partnership with Sodiaal and Euroserum enables Synutra to secure its long-term supply of raw materials and drive its future growth while maintaining a high standard of quality for its products.

"We are confident this collaborative effort can further increase consumer confidence and trust in our premium nutritional products," Zhang added.

The facility, which will comply with European quality and hygiene standards, is expected to go onstream by the end of 2014 and will employ 75 to 100 employees.

This agreement and the construction of the drying facility in Carhaix is subject to approvals from the Chinese government.

Synutra sells infant products, nutritional products and ingredients under brands such as Shengyuan and Synutra through a nationwide sales and distribution network in China.