China brands beat rivals with tea toothpaste & pickled plums

Under siege

Even traditional strongholds for foreign brands are under attack in China, including the market for infant milk formula. That market is one of largest and fastest growing, expected to be worth $25 billion by 2017, according to Euromonitor data.

Global companies including Mead Johnson Nutrition Co, Nestle SA, Danone SA and Abbott Laboratories have long dominated the premium formula segment but they have increased tie-ups with Chinese partners and boosted domestic supply chains to protect their position.

Chinese milk powder firms including Biostime International Holdings and Beingmate Baby & Child Food Co Ltd increased their market share last year, helped by a food scare that hit foreign brands as well as government drives to consolidate the sector.

In diapers, another area traditionally dominated by foreign brands, local firms are becoming more credible rivals, said a spokesman for Japanese diaper maker Kao.

"The potential challenge from Chinese domestic manufacturers has grown remarkably," he said.