TORONTO — The provincial government is giving $24 million to the largest Chinese investment in Canadian agriculture that is eventually expected to increase Ontario dairy milk production by seven per cent per year. The funding will help create local jobs at the Chinese baby-formula factory.
Feihe International is building a $225-million plant at Kingston, which will create 280 new jobs over the next five years.
The 280,000 sq. ft. plant will make baby formula from cow and goat milk. The company estimates it will need 220-250-million litres of cow milk per year. That amount — about seven per cent of the current volume of cow milk produced in Ontario every year — has been approved by the Canadian Dairy Council and the Dairy Farmers of Ontario.
Getting goat milk could be tougher. When the plant opens in 2019, it is estimated the company will need 10-million litres of goat milk per year, and eventually 75-million litres annually. The Ontario dairy goat industry currently produces about 45-52 million litres per year, but most of that milk has already been contracted elsewhere.
The dairy goat industry believes it can fill the demand and increase the number of milking goats in a short time. The gestation time for goats is about five months, and goats can reproduce twice within 18 months. As well, most second and third births for goats are twins or triplets.
The plant would be North America’s only goat milk infant formula facility and will produce 60,000 metric tonnes of dry infant food. About 20 per cent of the final products will stay in North America. The other 80 per cent will be shipped to China. Chinese industry experts are expecting a boom in baby formula sales as China is phasing out its one-child-per-family policy and has huge numbers of babies born each year.
The number of children born in China in two years is almost equal to the population of Canada. In 2016, 17.86 million babies were born in China, about 49,000 newborns a day.
Chinese parents prefer formula made outside of China after several scandals. In 2008, six babies died, 54,000 were hospitalized and 300,000 babies were ill due to high levels of melamine found in baby formula that had been produced by a company in China. Two people were executed for their role in the scandal. About four years before that, at least 13 infants died from malnutrition because of watered-down formula produced by another factory in China.