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Interview with Dai Junqi, Vice President of Fonterra Greater China: Unlocking the Traffic Code of the 600-billion-yuan Bakery Market

Interview with Dai Junqi, Vice President of Fonterra Greater China: Unlocking the Traffic Code of the 600-billion-yuan Bakery Market

As a leading supplier of dairy ingredients for the bakery industry and a significant source of creative application ideas and cutting-edge market insights, Fonterra's Anchor Professional Dairy brand is deeply integrated into the booming Chinese bakery sector.

"Recently, my colleagues and I visited a leading domestic life service e-commerce platform. To our surprise, in the first two weeks of May, the top search keyword in Shanghai was not hot pot or barbecue, but cake," said Dai Junqi, Vice President of Fonterra Greater China and Head of Foodservice Business, in a recent exclusive interview with Little Foodie at the China International Bakery Exhibition in Shanghai.

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 In Dai Junqi's view, on one hand, the trend of industrialized and retailized baking driven by retailers such as Sam's Club, Pang Donglai, and Hema continues to develop. On the other hand, a large number of specialized stores offering high-quality, differentiated, and strong brand influence freshly-made baked goods have emerged to cater to current consumption trends. Additionally, online baking has rapidly expanded through interest-based e-commerce and social media platforms. All these factors have brought new growth opportunities for Anchor Professional Dairy in the baking channel.

The market opportunities behind trends such as accelerated industrialization of baking, diversified consumption scenarios, rapid growth of core categories, and quality upgrades collectively form a new blue ocean worth hundreds of billions of yuan for dairy applications. He emphasized, "Anchor Professional Dairy, relying on the quality advantage of New Zealand grass-fed milk sources, provides customer-centric services and innovative solutions to help customers grow their baking businesses and achieve a win-win situation."

In the face of numerous new trends in the baking channel, what new strategies does Anchor Professional Dairy have in China? Let's take a look.

Innovative full-chain services help create baking hits

In recent years, membership stores like Sam's Club and Costco, as well as new retail channels like Hema, have significantly promoted the development of the "factory +" industrialized baking model by creating their own brand baking bestsellers. The entry of new players like Pang Donglai and Yonghui, along with the rise of online baking through interest-based e-commerce and social media live streaming, have become the latest "accelerators" for the industrialization of baking.

According to relevant research reports, the market size of frozen baking is approximately 20 billion yuan in 2023 and is expected to grow to 45 billion yuan by 2027, with an annual growth rate of 20% to 25% over the next four years.

This represents a huge business opportunity for Anchor Professional Dairy, which provides ingredients such as whipping cream, cream cheese, butter, and cheese to the baking industry. It is also one of the key players behind the 600-billion-yuan baking business in the Chinese mainland market.

"We noticed this trend around 2020, and (frozen/pre-prepared baking) has been showing a very good development trend in recent years," Dai Junqi told Little Foodie. Anchor Professional Dairy established a dedicated team for foodservice retailization to serve the demands from emerging retail channels. At the same time, it has developed its own service approach: on one hand, providing products and solutions suitable for industrialized baking production to contract manufacturers, and on the other hand, jointly providing market insights and innovative proposals to contract manufacturers and terminal retailers, gradually becoming a professional dairy service partner for baking bestsellers and contract manufacturers in emerging retail channels.

At the exhibition, Anchor Professional Dairy set up a "Baking Industrialization" zone, showcasing products and corresponding solutions and services tailored to the needs of industrialized baking customers. This includes the newly launched 10L Anchor Baking Cream specially designed for the Chinese market and the 25KG Anchor Original Flavored Pastry Butter, which won the "Innovative Product of the Year" award at the exhibition, meeting the demands of large-scale production and diverse packaging specifications. Little Food Times also learned that recently, Anchor Professional Dairy has launched a series of activities to connect upstream food processing enterprises, new retail platforms, and terminal baking and catering brands, building an industrial collaborative innovation platform from "raw materials - factories - terminals".

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 This project has facilitated in-depth cross-channel connections and resource complementarity between baking raw material suppliers and tea drink brands, as well as between chain catering and retail channels, by sharing cutting-edge industry trends and consumer insights, showcasing Anchor Professional Dairy's innovative solutions, product testing experiences, and professional technical exchanges. It has opened up new cooperation and business opportunities for its partners. During this exhibition, Anchor Professional Dairy also invited supply chain partners who share the pursuit of high-quality raw materials to the scene to showcase their products and solutions to end customers.

Unleashing the "Daily Healing" Baking New Scenario

Among the many booming baking consumption markets, Anchor Professional Dairy has observed that the trend of diversified consumption scenarios hides huge market opportunities and growth space.

Dai Junqi pointed out, "In recent years, we have noticed that the 'threshold' for cake consumption is significantly lowering, and the consumption scenarios are clearly broadening and diversifying." He explained that this change is mainly reflected in the extension of cake consumption scenarios from traditional special festivals to various scenarios in daily life. "In the past, cake consumption was mainly concentrated on specific occasions such as birthdays and anniversaries; but now, consumers' motivations for buying cakes are becoming increasingly diverse - including traditional or special festivals like Mother's Day and '520', as well as various scenarios in daily life: rewarding children, friends' gatherings, housewarming celebrations, and even just to please oneself and create a sweet moment for stress relief and self-reward."

Dai Junqi believes that the changes reflected in the above trends ultimately indicate that baking products are gradually evolving into important carriers of people's emotional value needs. The trend of diversified and daily consumption scenarios in baking also poses new demands on baking products.

"In baking stores on the streets or in shopping malls, you will find that the size of cakes is getting smaller, for example, from 8-inch and 6-inch to 4-inch mini cakes. At the same time, people's requirements for cake quality are also getting higher, including delicious taste, beautiful appearance, and healthy ingredients."

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 He said that the current baking industry mainly presents two significant features: one is the rapid iteration of popular trends, and the other is the increasingly diverse tastes of consumers. "In the baking field, product innovation is endless," he emphasized, "the only limit is the boundary of our imagination and the creativity of ingredient combinations."

To meet and adapt to the rapid changes in the baking consumption market, Anchor Professional Dairy, on the one hand, relies on its professional business insight team and the perception of the market and timely communication with customers to obtain real-time terminal consumption data and customer needs; on the other hand, it integrates global baking resources, including the French M.O.F (Meilleur Ouvrier de France, the Best Craftsmen of France) master team, international bakers with Japanese and Southeast Asian fusion styles, and local chef teams, to build a diversified product innovation support system. This "global vision + local insight" R&D model provides continuous technical support and inspiration for product innovation.

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 Little Food Times saw that in response to the emotional value demands of young consumers for food and beverages in the current "healing economy", Anchor Professional Dairy innovatively linked the "smooth, fine, and stable" product characteristics of Anchor Whipped Cream with the healing IP "Little Bear Bug" at this exhibition. The co-branded series on display at the event not only includes cute Western pastries such as mousse cakes and cream cakes, but also a series of themed peripheral products. This provides a new model for baking brands to create best-selling products that combine aesthetic appeal and emotional resonance, helping terminal brands offer consumers a comprehensive healing experience that encompasses both taste and emotional comfort.

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Anchor Professional Dairy and the healing-themed IP "Little Bear Bug" have launched co-branded products

Focusing on core categories for rapid expansion

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"Among our five product categories, Anchor whipping cream is the best-selling category, while the sales growth rate of Anchor butter has been more prominent in the past year," Dai Junqi told Foodie. Compared to the past, the popularity and application scenarios of butter in Chinese daily life have greatly expanded. Compared to traditional shortening, butter does not contain trans fatty acids and is naturally more nutritious, which aligns with consumers' pursuit of healthy diets.

 At the same time, the unique milk flavor of butter can add rich textures to food. Besides its core application in Western pastries, butter has also driven the transformation of traditional Chinese cuisine towards high quality in new retail or in-store dining scenarios. Therefore, many health-focused brands have made high-quality Anchor butter a key selling point of their products, and its application scenarios have expanded from Western baking to Chinese cuisine - not only are various breads and pastries increasingly using butter, but it is also more frequently seen in Chinese breakfast items like hand-pulled pancakes, as well as traditional Chinese dishes like hot pot and stone pot dishes.

Meanwhile, Anchor whipping cream, a traditional core category of Anchor Professional Dairy, also shows an optimistic growth outlook.

"Whipping cream is the product category that contributes the most to our sales," Dai Junqi mentioned. As China is the most important market for Fonterra's food service business globally, its consumption demands will directly guide the research and development direction of whipping cream products and have a profound impact on global production capacity layout.

Foodie learned that China's import volume of whipping cream reached 288,000 tons in 2024, a 9% increase compared to 264,000 tons in 2023. According to the data for the 12 months ending in March this year, the import volume of whipping cream was 289,000 tons, a 9% increase over the previous 12 months, indicating a stable growth in the market.

It is worth noting that a new national standard, "Food Safety National Standard Whipping Cream, Cream and Anhydrous Milk Fat" (GB 19646-2025), was newly issued in March this year. The new standard clearly stipulates that whipping cream must be processed from raw milk, while modified whipping cream is made from raw milk, whipping cream, cream, or anhydrous milk fat, with the addition of other ingredients (except non-milk fat). This standard distinguishes between whipping cream and modified whipping cream and will be officially implemented on March 16, 2026.

The release of the above product standards and labeling regulations further clarifies the labeling requirements, promotes market transparency and standardization, enables consumers to have a clearer understanding of product ingredients and other information, and helps regulate production and ensure product quality. It also provides a more explicit standard basis for enterprises to develop and produce products.

"This is another major measure for the high-quality development of the industry," Dai Junqi said. Anchor Professional Dairy products, including Anchor whipping cream, are made from raw milk from grass-fed* pastured cows in New Zealand. Through intelligent milk tankers, Fonterra's dairy farms across New Zealand achieve reliable collection, precise traceability and testing, and full cold chain closed-loop transportation of milk, ensuring the safety and nutrition of every drop of raw milk.

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 Looking ahead, he said that Anchor Professional Dairy will continue to respond to market demands with high-quality dairy products and innovative applications, while collaborating with more local partners to promote localized innovation, drive dairy product upgrades, and contribute to the high-quality development of China's food service industry, especially the baking sector.


Post time: Jun-03-2025