China Dairy has built a strong reputation as a dependable milk supplier to large Chinese dairy processors.
The company has achieved this stable supply of milk while adhering to high quality standards through its unique business model. The Company generates revenue on milk sold from cows it owns and from cows owned by farmers it is partnered with.
Of the 33,000 cows owned by the company, approximately 23,800 are reared and milked by outsourced farmers. The company ensures a consistent and high quality raw milk product by having in place systems for farmers to use a unified feeding methodology and placing strong emphasis on quality control measures.
The company's partners, which currently own over 16,000 cows, purchased their cows directly from China Dairy. The company arranges the sale of milk from these cows to its customers and in exchange, receives 30% of the milk sales revenue generated.
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About China Dairy Corp Ltd
China Dairy Corporation Limited (ASX:CDC) is a company primarily engaged in the production and wholesale of raw milk and the rearing, breeding and sale of dairy cows in Heilongjiang province, China.
CDC generates revenue through two primary business models:
- the sale of raw milk from cows that are owned by the company; and
- milk sale commissions on the sale of raw milk from cows the company has sold to farmers.
As at 31 December 2016, CDC owned 31,877 cows and partnered with farmers with an additional 21,617 cows from which CDC makes a sales commission on the milk sold.
China Dairy Corp Ltd