Facing Competition, Tnuva Seeks Its Fortune in China, America

The soft cheese market in Israel is set to open up for international competition beginning January 1st– and Tnuva, the dairy conglomerate that was bought last year by China’s Bright Foods, is ready, with a strategy that will see the company’s products spread themselves far and wide, being sold in China, the U.S., and in new forms in Israel, according to business daily Globes.

The first shipment of Tnuva products to China is set to leave for Beijing next week, Tnuva officials said. The first Tnuva products to be sold in China will be frozen vegetables, sold under the Sunfrost brand, to be followed by frozen baked goods marketed by Ma’adanot – which sells Israeli specialties like borekas, malawach, and jachnun, the latter two Yemenite-inspired dough products. Company officials will see what sells before deciding what more, or what else, to send China.

According to company officials, China could be a very lucrative market for Tnuva. Because of the relative lack of milk available to the population numbers, all cheese in China is imported – and the prices are two and half times those in Israel.

At the same time, Tnuna is preparing to take on the world’s other great market – in the U.S., Tnuva-branded cottage cheese is slated to be produced at a factory in Minnesota. The factory does not belong to Tnuva, but if all goes well, more dairy products will be produced in the U.S., and the company is open to building its own facility if sales remain consistently good.

The opening of the cheese market in Israel to foreign imports is expected to have a major impact on Tnuva, which currently controls 80% of the soft cheese market in Israel. In order to compete with imports, the company is reconfiguring its Tal Yosef factory to produce cheese in oblong blocks, as opposed to the current square ones. Market research, company officials say, indicate that much of the soft yellow cheese (such as Emek and Gilbo’a) sold by the company ends up in sandwiches, and the new shape will more closely match the shape of bread Israelis use to make their sandwiches. New machinery in the factory will also enable the company to produce cheese in shapes that will appeal to children, such as animals, the company added.