Chinese milk products producer Feihe International is developing a new infant formula production facility in the City of Kingston, Ontario, Canada.

Canada Royal Milk will undertake the project, which is said will be the first facility of its kind in Canada, as well as the first goat milk infant formula facility on the North American Continent.

With an investment of approximately $225m, the baby formula plant project represents one of the largest foreign direct investments in Canada. Construction began in August 2017, while operations are expected to begin in 2020.

“The facility will occupy a 320,000ft² area and include separate production lines for goat and cow milk.”

The project will create 250 direct and more than 1,500 indirect jobs in addition to more than 400 construction vacancies over the two-year period.

Location of Feihe International’s baby formula plant

The new baby formula plant is being developed on more than 40 acres of land in the Cataraqui Estates Business Park located to the west end of Kingston.

This location was deemed to provide easy access to milk suppliers and was selected due to its proximity to the four-border crossings and Highway 401.

Details of the infant formula facility

The facility will occupy a 320,000ft² area and include separate production lines for goat and cow milk.

The plant is planned to be developed in three phases, with Phase I focussing on infant formula production from cow milk and Phase II involving infant formula production from goat milk.

Phase III will add either a nutraceutical products line or distribution facilities.

Processing and technology

The Kingston facility will utilise a wet blending process to produce high-quality infant formula for markets in the North American Continent and China.

It will be equipped with the Industry 4.0 integrated information technology, big data, Cloud computing, and other advanced technologies to manage the complex production process.

Financing

The Province of Ontario is investing $24m in Canada Royal Milk through its Food and Beverage Growth Fund and Jobs and Prosperity fund for the development of the new facility.

Contractors involved

Dahlgren Industrial was selected as the general contractor for the project, while Mallot Creek Group was subcontracted by Dahlgren Industrial for the site preparation work.

Milk supply for Feihe infant formula facility

The project will require significant quantities of milk for the production of baby formula. This is expected to improve and strengthen Ontario’s cow and goat milk market. Ontario currently has 52% of all goats in Canada and accounts for 75% of goat milk production.

Feihe will collaborate with the Quebec Ministry of Agriculture, Fisheries and Food (MAPAQ) and the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) to connect with goat milk producers in the provinces of Quebec and Ontario to secure milk supply for the plant.

Marketing commentary on Feihe International

Founded in 1962 and headquartered in Beijing, China, Feihe International operates through its subsidiary Feihe Dairy. It is a leading manufacturer and marketer of infant formula, soybean, rice, cereal and milk powder.

Feihe operates production and distribution plants in Shanxi, Gannan, Kedong, Longjiang and Qiqihar in China.

Its product line includes a series of infant products such as AstroBaby, Super Feifan and Feifan, and a wide variety of nutritious fresh milk products.