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Green light for A2 Milk exports to China

Shares in infant formula suppliers A2 Milk and Wattle Health Australia have climbed after both strengthened their regulatory position in the lucrative Chinese market.

A2 Milk announced yesterday its application to continue selling infant formula products in China has been approved by health regulator, the China Food and Drug Administration.
Formula manufacturer Synlait Milk, which has been in partnership with A2 Milk since 2010, submitted the mandatory application in May.

A2 Milk’s registration process included tests on raw material and finished products, certification of manufacturing standards, formulation assessment, and packaging changes, chief executive Geoffrey Babidge said.

Under rules previously announced by Chinese regulators, all infant formula manufacturers must register brands and recipes with the authority for products to be imported into China from January 1.

Meanwhile, Wattle Health has completed its previously announced $5 million purchase of a 5 per cent stake in Australia infant formula maker Blend & Pack, which is licensed to produce infant formula for China’s market.

Wattle Health said the deal ensured its formula range would be the first brand nominated by Blend & Pack for Chinese Food and Drug Administration approval.

Share in A2 Milk closed steady at $5.99. Synlait Milk stock was 9 per cent higher at $5.87 and Wattle Health closed 6.4 per cent higher at 82.5 cents.

Article written by Trevor Chappell and Simone Ziaziaris.
Adelaide Advertiser, September 29th 2017.