Watch: Bellamy’s brawl breaks out

Deary me. The Bellamy’s suitor is associated with a State Owned Enterprise (that is, the Chinese Communist Party) so obviously the acquisition should be blocked, if on no other grounds than unfair trade practices, blocking access then buying the company.

Now, back to the fight:

David Llewellyn-Smith

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

Latest posts by David Llewellyn-Smith (see all)


  1. Ah, the familiar hand-carts full of tins. Quite a regular sight.

    It’s nice that through our milk export trade we’re helping bring (big, wholesome and strong) up the infantry soldiers that will be marching through our streets in the future.

    • On the ABC news last night they said most of Bellamys powder is from the EU! So not sure how much they are helping our farmers

  2. Optus is owned by a SoE of Singapore, so that shouldn’t be the yardstick.

    Bellamy share prices have more than halved from its peak, and there is no where else to go but further down. We should sell it to the Chinese and then watch it crash and burn.

  3. SnappedUpSavvyMEMBER

    westfeild Hurstville…… lol if your any thing other then Chinese in westfeild Hurstville you stand out like a sore thumb

      • Back home they’d settle this dispute with a polite game of ping-pong. The southern hemisphere air does not agree with them, obviously.

  4. The ongoing irony of exporting Australian Standards foods to China, and importing Chinese Standards food to Australia.

    Globalism ftw.

  5. Bellamy milk power is mostly imported from Europe.

    ‘The chairman of Tasmanian organic infant formula manufacturer Bellamy’s told the Senate inquiry their product was mostly procured from Western Europe’.

    Then stuffed into the tins with ‘organic’ and other pseudo health marketing – so the Chinese can fetish being ‘western’.

    The Chinese then gobble down the junk hoping it will make them like the white man.

    It’s not for the infants or children.

    The whole Chinese family sits outside in the gutter under the yellow glare of the neon street lights.

    With great ceremony the hunched wrinkled old grandma carefully scoops from the pride of place milk powder tin (to show the rest of the slum they are ‘middle class’) into little bowls and then pours the hot water from a little kettle of hot water into the cups.

    Lots of stirring and sipping – the entire family – the old hunched over grandparents, the mother, father and the invariably obese asthmatic Chinese kid scoffing it down.
    Asians & particularly Chinese are Lactose & casein intolerant / it makes them vomit or gives them diarrhoea.
    And those Chinese kids will get early onset diabetes.

    Milk powder used to be a waste product or pig food.

    • John Howards Bowling Coach

      Asian people have a higher instance of lactose intolerance that does not equal ‘Asians & particularly Chinese are Lactose & casein intolerant / it makes them vomit or gives them diarrhoea.’

      Yes China is still largely a nation of peasants and people with no manners, style, or sophistication, but you do overstate like crazy.

    • Likewise, JHBC, our Mike is prone to exaggeration. Having spent 4 years working around the Chinese dairy sector, his summation of milk use is not correct.

    • “… hoping it will make them like the white man. ”

      You’d be pretty annoyed if your child grew up to have a penchant for Holden HSVs and cheap tats

  6. A cautionary tale has arisen for Australian companies seeking to expand their business into China. A proposed takeover of local dairy product innovator Bellamy’s (BAL) by CCP controlled Chinese dairy company China Mengniu Dairy provides clear guidelines about how “China Inc” deals with foreign companies.
    In 2018/19, Bellamy’s found itself highly exposed to the Chinese market for its massively successful offerings of infant formula and several additional dairy products. Then suddenly, changes to Chinese regulations amongst other issues, saw the company’s FY 2019 revenue slip by $63 million to $266 million while it’s EBITDA fell $24 million to $47 million.
    Even though the company remained significantly cash flow positive and held a strong net cash position of $112 million, it was clear that doing business in China has little to do with an even playing field. It’s not just about product, competition, marketing and costs. Business in China is also about Chinese regulators and authorities batting for the home side! In this case, the bidder China Mengniu Dairy is owned and controlled by the Chinese government, who of course changes the rules to suit their purposes, against the best interests of foreign interlopers. No wonder the Trump administration has had enough with this sort of non-market competitive behaviour!
    So, having seen its share price tumble from $22.59, back below $7 per share, an offer of $13.25 per share presented a potential graceful exit point with a saving of face all round! Inevitably, Australia’s FIRB should reject this bid as clearly a takeover by a foreign government which had tilted the playing field to its advantage so it could make an opportunistic bid, leaving Bellamy’s in the uncomfortable position of facing an increasingly obstructive Chinese regulator.

    • Given Bellamy is a virtual marketing company selling a dream (and targeting aspirational Chinese), now may be a good time to get out.

      • John Howards Bowling Coach

        It is not so obvious as to who is scamming who, you’re correct. Bellamy’s is really just a shell, I hired a former staff member from there a few years back quite a tale of poor management. But it is also obvious that China Inc has intentionally played the market to their attempted takeover and for that, they should be screwed right back. Either force up the price they pay and then shut down the company with a new law against imported diary from Europe through a technicality, or some other means to do them over.

        The world needs to wake up to China, it’s not something we’ve seen often before, a state economy they can and will change their laws to the commercial advantage of the state. This is usually done by companies through lobbying. The Chinese are highly efficient.

        A warning to the whole globe, never get dependent on the Chinese as a customer, they are more ruthless than a crack dealer.

  7. I am looking forward to the management of Bellamys setting up a new organic milk powder (again mostly sourced from Europe) scam to sell the products across Asia, including China, from the profits of this sale. Another locally owned company can start up a similar business at any time. Most of the value in Bellamys is in its brand name and the Asian marketing arrangements.

    Milk powder, even sourced from goats, has given me health problems and I would never give it to my children.

    Let the Chinese own the brand so long as they do not replace the local workers with vibrants – preferably they move the operations to Asia and use cheaper labour there.

    • Bellamy wasn’t the one doing the marketting : it’s the Daigou trying to drum up a product that did the marketting. The shareprice of Bellamy’s shareprice reflects on the CEO having no clue on why their product is selling in China.

      • John Howards Bowling Coach

        Correct, when Bellamy’s announced they would supply through official channels and reprice to make their brand accessible to more Chinese in China the Daigou masses dropped them in a second and swapped to A2 milk powder. Bellamy’s was like most Aussie brands, unaware of who and how their customers where getting their brand and why. I spoke to them years ago and they actually thought that they did not export much, they felt they were a local success story and became a darling of Woolies and Coles who were slowly waking up to who was buying in their stores (partly due to their own shopper reward programs of data collection). The reality was very few people in Australia were using Bellamy’s as we have food safety laws that largely contain the growth of overpriced organic claims. So the reality of the bulk of the volume of Bellamy’s sales was hidden from them in plain sight simply because they failed to dig deeper into who was buying and who was using their brand.

        The unwashed greedy masses of Daigou exporters in the Video above are an important tool to establish your brand and credibility in China if you understand how it works. They are a fickle bunch though, take away their profit and they’ll dump you in a second, for their next big thing.

  8. John Howards Bowling Coach

    The tale of Bellamy’s is just another example of what lazy Aussie’s always do, sell the farm instead of the milk. Why sell your business to them when they will keep on buying your produce? Because you are too lazy and short sighted to actually have a long term strategy to develop a globally competitive business, that’s why. Australia is a nation of greedy fools, it was too easy to get rich as a property investor/developer and no one has ever really wanted to work hard to achieve something great in this nation. Even the old chestnut BHP was long ago sold off to foreigners.

  9. John Howards Bowling Coach

    The Video from the story is a fairly normal event in the stores of Australia these days BUT I wonder if that message sinks in to the voters of Australia. These Chinese peasants flooding into our nation, welcomed with open arms by the Federal Government for the shot in the arm to the GDP top line number are a tribe of filthy peasants, despised the world over for their lack of manners, greedy and this is who we are letting into our former piece of paradise. It will take century to wash out the stink, and craft their kin into decent people and return our country to a great society even if we were to close the doors today. Oh, what have we done to ourselves?