Cream of the crop: The dairy boom in China’s bakery market

By Gill Hyslop

- Last updated on GMT

Related tags Glanbia Dairy China Bakery China

Irish dairy processor Glanbia is capitalizing on the Chinese consumer’s growing penchant for full-fat dairy creams – especially prevalent in raft of exquisitely decorated cream-topped cakes on show at Bakery China.

According to Stephen Brown, director of exports, Glanbia Consumer Products, Ireland’s largest dairy processor has been selling in the China market for around five years, and now has an office in Shanghai with seven staff.

“We are very focused on selling Avonmore, Ireland’s number one dairy brand, into the Chinese bakery market,”​ he told us at Bakery China, held earlier this month in Shanghai.

The company used the premier tradeshow to launch its Avonmore Professionals brand – packaging had been completed in Ireland two weeks prior – which includes two offerings, 35.1% fat and 38% fat.

Veg oil versus full fat

Browne said the Chinese bakery market is ‘definitely’ still growing.

“It’s been through a phase of very rapid growth and now I think the market, like a lot of sectors in China, is not growing as fast but definitely growing in terms of value and premiumization.”

He noted Chinese consumer traditionally purchased cheaper-end margarines and vegetable oil creams, but now they are interested in dairy fat-based products, balancing the market ratio between veg oil and UHT creams.

The art of the gift

He believes the demand is driven by taste.

“Bakery was not a traditional sector in Chinese cuisine, but it’s very much driven by gift giving. When you go to someone’s house or a birthday party, you bring a gift and that, nowadays, is a very fancy cake,”​ said Browne.

“Wedding cakes, in particular, can be incredibly fancy – one of our customers in China is selling a €300,000 cake, for example – so, at those levels and prices, customers want very good quality.”

“Our Irish, grass-fed product is beginning to gain traction with our customers,”​ adding that, although New Zealand commands the biggest market share of the Chinese market, “we think we have as good an offering.”

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