China-based Mengniu has recently opened its 1st ASEAN manufacturing plant in Cikarang, West Java in Indonesia mainly for the production of its flagship YoyiC line of yogurt products.
In December 2018, the YoyiC products were released for distribution to 12,000 stores in the major cities in Indonesia.
Mengniu CEO Lu Mingfang aims to make YoyiC the No. 1 yogurt brand in Indonesia in 3 to 5 years. At present, yogurt commands only a small consumer market in Indonesia, achieving only 17% in terms of market penetration rate. Lu however believes in Indonesia huge potential. He said, “In Europe, it (the market penetration) is close to 95%. Even in the case of China, Japan, and Hong Kong, it is 80%. So there is a lot of potential to grow,” Lu said.
The new 15,000 sq.metre plant with an investment of US$50 million has a daily production capacity of 260 tonnes churning out products valued at US$160 million annually.
Lu added that in Indonesia, there is no dominant yogurt brand yet, despite the presence of a few international and local players. The Indonesian plant is also Mengniu’s 2nd overseas plant with the first being Mengniu’s Yashili plant in New Zealand, established in 2015.
Mengniu is currently undertaking an aggressive globalisation strategy, and if its plan in ASEAN turns out according to plan, it hopes to expand into the US, Europe and Africa.
Mengniu’s entry into Indonesia also marks the opening of the first Chinese dairy production base in ASEAN. Indonesia has the largest population in ASEAN and is also one of the first supporters of China’s ‘Belt and Road’ initiative.
YoyiC probiotics beverage and yogurt products are made with milk from quality milk source in Oceania and Indonesia, applying Mengniu's world leading production technology and quality control system. New probiotics developed by Mengniu and esteemed Danish R&D institutes are added in the products targeting middle to high-end consumers.
It has already been sold to mainland China, Hong Kong, Macau, Singapore and other countries in ASEAN. It has earned 7-Eleven Singapore's "Most Popular Brand" title for 2 consecutive years.