Danone signs dairy joint venture in Colombia

Danone announced it had joined up with local firm Alqueria to co-operate on the production and distribution of fresh dairy products in Colombia.

The move re-iterates Danone's strategy of tapping new dairy markets, as emerging markets increasingly provide the backbone for the group's sales growth.

Colombians eat relatively little dairy, around 3kg per person per year, leaving obvious room for growth.

Danone, owner of brands such as Activia and Actimel, said the deal with Alqueria would also strengthen its hand in the regional market for fresh dairy.

Antoine D'Estaing, Danone 's chief financial office, told the Wall Street Journal last year the group was looking for small to medium businesses in new, emerging markets .

The company, he said, was ready to spend between €500m and €1bn.

More acquisitions and deals in emerging markets could help Danone to establish itself clearly as the world's third largest dairy firm, by sales.

It sits third already, but only just, with New Zealand's Fonterra and Dairy Farmers of America close behind, according to Leatherhead Food International.

Several other European dairy firms have also increased their focus on emerging markets recently.

Earlier this month, Arla Foods said it would look to sell more milk powder in Algeria after success for its export business in China.

Rival Friesland Foods, meanwhile, has been making moves in Asia.

It plans to build a second dairy plant in Vietnam and, only last week, signed a joint venture with Australian dairy group, Warrnambool.