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FOREIGN EXCHANGE

Cheese-makers chase huge new market in China

Business owners may have a tough time in China, where many are still wary about milk after the melamine debacle and an estimated 90% of the population is lactose intolerant.

May 19, 2011|By Benjamin Haas, Los Angeles Times
  • Liu Yang of Le Fromager de Pekin makes cheese in his Beijing factory.
Liu Yang of Le Fromager de Pekin makes cheese in his Beijing factory.

Reporting from Beijing — In her two years working at a French specialty foods shop in Beijing, Li Mengling has had an opportunity to taste imported goods that people in her village in rural Hubei province have never heard of, let alone dreamed about.

She's found some new favorites and one fervent dislike.

"I like the lamb chops and the salami," she said. "But the cheeses, I don't like any of them. I can't think of anything I've ever tasted that's so horrible."

But a small number of artisanal cheese makers, both Chinese and Westerners, want to change that perception. Their task is daunting: Except for a small number of ethnic Mongolians and Tibetans, China has no tradition of cheese making, and an estimated 90% of the population is lactose intolerant.

Exacerbating the issue, Chinese are especially wary of dairy products amid a continuing problem with tainted milk that has killed dozens of people.

That doesn't deter Liu Yang, who runs Le Fromager de Pekin, a small French cheese factory on the outskirts of Beijing, an outpost that could be the best chance for educating China's nouveau riche on artisanal cheese. He believes his company, the only one run entirely by native Chinese, can better predict the demands of local consumers.

The small two-room shop reeked of cheeses aging in the back, with fromage blanc, crottin and buchette odors mixing to form a funky, slightly sweet aroma.

Liu's two employees, dressed in white, are strictly sequestered so no outside bacteria infect the small wheels of Camembert.

Liu, 37, spent seven years in France studying the language, business administration and cheese making. Upon his return to China in 2007, he stumbled through careers in translation and IT sales before opening Le Fromager de Pekin, which sells about 5,300 pounds of cheese a year.

For Liu, lanky with a buzz cut and thick black glasses, it was love at first bite when he tried Camembert, a creamy and often pungent cheese.

"The first time I tried it I couldn't stop," he said. "I went right back to the supermarket and bought as many different kinds as I could."

Although Liu's mission is to promote cheese to fellow Chinese, almost all of his clients are expatriates living in Beijing. Still, he's convinced that will change.

"Cheese will be like wine and coffee," Liu said, referring to other imported products that were initially unpopular with Chinese consumers. "There will be two to three years of slow development, and then all of a sudden, consumption will shoot up."

His signature product is a Camembert-like cheese called Beijing Gray, a name frequently misinterpreted by his foreign customers: "The name doesn't have anything to do with Beijing's polluted skies," Liu said.

Although the market is flooded with mass-produced, processed mozzarella for making pizza (a Western food that has managed to catch on in China), artisanal offerings are still a niche market. Cheese imports jumped 47% in 2010 from a year earlier, according to the U.S. Dairy Export Council, which has run cheese workshops for more than a decade to spur consumption.

Local shops are also pushing to tap into China's growing interest in foreign goods. At a shop called Cheese & Wine in Beijing, which has been open for eight months, Chinese already represent half the clientele.

"At the end of the day, you have 20 million Chinese in Beijing, with a growing middle class who have money and want to try new things," said owner Christophe Pompeani. His wife, Anna Chen, runs a Chinese-language blog on cheese and answers questions from curious readers.

Pompeani isn't the only one who thinks the cheese market could take off in China. In 2003, Dutch agriculturalist Marc de Ruiter saw dairy farmers in windswept Shanxi province literally pouring their milk down the drain because there was not enough demand. He seized this opportunity to make Dutch Gouda and now his firm, Yellow Valley, has annual sales of more than $152,000.

David Grimm, Yellow Valley's sales director, explained that the company focuses mainly on foreigners living in China, but that more Chinese are buying its products. The key to expanding the market is education, he said.

"Most Chinese people walk right past the cheese section in a supermarket," Grimm said. "But if they taste our cheese, they like it.

"The workers in our factory, they put our cheese in their dumplings. It's like ravioli."

Despite this progress, China's dairy industry is still feeling the effects of a 2008 scandal over melamine-tainted-milk that sickened 300,000 people and left six infants dead. As late as July 2010, about 70 tons of dairy products were seized when they were found to contain the additive, which can cause kidney failure.

"The government needs to do more to ensure the safety of dairy products," said Liu, the Beijing cheese maker. "Otherwise these scandals will continue to negatively affect consumer perceptions of the cheese industry."

Haas is a news assistant in The Times' Beijing bureau.

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