Jul. 9, 2007 (China Knowledge) – Swiss food giant Nestle Group officially opened its new milk product factory in northern China's Inner Mongolia region on Jun. 5. The new diary factory comes at a timely moment to help Nestle cope with the surging consumer demand for its dairy products.  
 
Nestle's newest addition, its third dairy factory in China, will produce milk by processing about 600 tons of milk per day, China Daily reported citing the chairman and CEO of Nestle Group Worldwide, Peter Brabeck. 

The location of the factory was chosen for its natural grassland where over 4,300 farmers reside. The factory will be collecting fresh milk from these farms which will be processed and made into dairy products such as ice cream and confections, according to sources.

Backing the launch of its new dairy facility in China, Nestle spokesman said that milk products stand as Nestle's largest single business in the Mainland and one of the its fastest-growing markets in the world.

As consumer spending power grows in tandem with the blooming economy, this will in turn help to boost the sale of milk products. In addition, a baby boom starting last year helped increase the sales too.
 
China's dairy sales reportedly surged 23% to RMB104.1 billion last year.

According to the agriculture-rooted Dutch cooperative banking institution Rabobank Group's 2006 report, the demand for dairy products has more than doubled in the past five years and will continue to climb 12.8% annually to almost 40 million tons by 2010.