ATM - A2 Milk Corporation Limited

[JohnnyTheHorse]

It is all sourced and processed in NZ. I believe it is packaged into its individual final tin in NZ as well (based on the image from this article: http://www.nzherald.co.nz/business/n...ectid=10878909).

[blobbles]

Yep by the looks of that Herald article it's being canned for final sale in Dunsandel. Hopefully they haven't simply moved their dodgy practices into their NZ factory... Anyone know the regulatory oversight that goes on to protect our export name? Have been a little worried about this since I saw the big chinese owned factories going up in NZ, if they start exporting low quality / poisonous goods directly from NZ all of NZ's exports will be called into question and severely impacted.

[ratkin]

Announcement looking all good , finally we have some real news and not just endless waffle about market depth.

[futurist]

I would like to know if their product is arriving in China just as they send it from New Zealand or if it is being sent to Guangzhou /Shanghai first for "processing". This is because I know how Chinese do business here with other imported milk powder which is to take the imported powder in bulk, cut their own ingredients into it then repackage it for mainland customers. This makes them more money but of course introduces Chinese capitalism into the production chain, causing the addition of unknown elements into their product. Anyone know the answer to this or can call the company for clarification? Chinese people will pay top dollar for the real deal milk powder, but anything that has been processed in China they will be highly sceptical of.

Mainland Chinese do not trust any milk powder that is locally made or processed; that's why it becomes headline news when Hong Kong introduces a maximum penalty of HK$500,000 and 2 years imprisonment for any visitors taking more than 2 cans of milk powder across the border. In Europe there is no such regulation yet, but all retailers have set straight limits to sell to the Mainland Chinese. I believe we have or used to have something similar in NZ too.

While it is a bit sad to see a country where the people do not trust their own products, and obviously it could be annoying to see them clear out all stocks in supermarkets and pharmacy at a worldwide scale; it is a great business opportunity to export milk powder directly to China without any involvement of the local factory. Hong Kong Government is being naive to control the demand instead of encouraging more supply. In fact, the current supply of milk powder in Hong Kong is at least 20x more than its local needs, so the solution should be speeding up the supply instead of destroying the industry.

Following that line of thought, ATM would only do well if they export directly to China and I think that is the case.

[blobbles]

As an indication from my friend, who has been in the biz over here (I am in China), last year there were 58 different brands of milk powders imported to China. 56 of those were "processed" in China, the milk came in bulk (mainly from NZ) and was "enhanced"/"reprocessed for local needs" in China before being on-sold to consumers as "imported milk". Of course, technically it was "imported milk", but in reality it had whatever the Chinese factory wanted put into it. Hence the melamine scandal of a few years ago and the completely justified scares of Chinese consumers just trying to feed their babies because a lot of them don't naturally produce enough breast milk.

My question is, under what guidelines do Synalit operate in New Zealand? Their website claims it is to NZFSA guildlines which, if true should see the sales of infant milk for A2 go absolutely ballistic and I would suggest their 60 million of sales in 5 years is terribly pessimistic - they could be one of the only suppliers of high quality low allergy milk (remember a lot more Asians compared to Europeans are lactose intolerant) into China. As such they should sell out of the stuff as fast as they can make it, maybe the 60 million figure is only an indication of how much they can supply?

[JohnnyTheHorse]

As far as I'm aware any food product produced in NZ must comply to all NZ regulations, even if it is to be exported. It must obviously then also comply with any regulations in the recipient country.

Also, note that a2 Milk still contains lactose, so is no use to anyone who is lactose intolerant

[Hoop]

Announcement looking all good , finally we have some real news and not just endless waffle about market depth.

Market depth ...waffle???....Don't you want to know how many buyers and seller there are in the market and at what price they are willing to buy or sell for ATM.

I would never ever buy or sell a share without checking the market depth first....there are some non-active investors out there that can't obtain depth data...

[Lawt]

My question is, under what guidelines do Synalit operate in New Zealand? Their website claims it is to NZFSA guildlines which, if true should see the sales of infant milk for A2 go absolutely ballistic and I would suggest their 60 million of sales in 5 years is terribly pessimistic - they could be one of the only suppliers of high quality low allergy milk (remember a lot more Asians compared to Europeans are lactose intolerant) into China. As such they should sell out of the stuff as fast as they can make it, maybe the 60 million figure is only an indication of how much they can supply?

Is A2 milk lactose free?

[blobbles]

Sorry, didn't mean to indicate the milk is lactose free, I just meant to indicate that many asians aren't used to a milk rich diet and therefore aren't as tolerant to milk proteins as us westerners. A2 milk has a different protein makeup which theoretically makes it less allergenic to those that aren't used to milk... "theoretically" as its still being argued for and against, as far as I know.

[futurist]

As an indication from my friend, who has been in the biz over here (I am in China), last year there were 58 different brands of milk powders imported to China. 56 of those were "processed" in China, the milk came in bulk (mainly from NZ) and was "enhanced"/"reprocessed for local needs" in China before being on-sold to consumers as "imported milk". Of course, technically it was "imported milk", but in reality it had whatever the Chinese factory wanted put into it. Hence the melamine scandal of a few years ago and the completely justified scares of Chinese consumers just trying to feed their babies because a lot of them don't naturally produce enough breast milk.

Depends on your definition of import, there could be more than 58 brands in total if you count those ones that come through the border by the ant-moving mechanism. Yes, that is a term used to describe how they use hundreds or even thousands of people to each move a few cans of milk powder across the border of Hong Kong every single day. Those human-imported milk powder is the one that is trusted by the middle class Mainland Chinese (the upper class would have different ways to obtain them). They are all sealed and not officially imported to China, even the exact same brand could be found officially from the import list, maybe one of those 56 brands you talk about. But they are not considered imported milk from the consumer's point of view. The local people are smart enough to differentiate.

If you are in China, you should be able to see with your own eye that those enhanced milk powder products are not doing very well at all. It is because the real business opportunity lies only with the true import route and everybody knows that, including A2.