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Tuesday 28 June 2022

Chinese demand drives expansion for Alfa Pet

26th May 2021 By Monique Steele | | @foodtickernz

High school friends Joy Huang and Fish Fei are ramping up the production of their premium pet food brand, piquing interest from overseas investors.

Alfa Pet directors Joy Huang and Fish Fei.

Auckland-based premium pet food exporter Alfa Pet is in negotiations to establish a second processing plant to meet growing demand from the Chinese market.

Making a turnover of $1.5m last year, and with “turnover rising day-by-day, year-by-year”, co-director Joy Huang told the Ticker that she and fellow director Fish Fei were “really lucky guys”.

“Both our processing plant in Christchurch and packing facility in Auckland have reached capacity. We’re having more and more orders coming from Asian countries so we would like to scale-up our plant,” Huang said.

“We’ve been really lucky. With the expansion planned for this plant, the orders keep coming.”

Starting with merely $20,000, the two high school friends invested in their first property, a packing warehouse in Auckland in 2015. Once they established the wet processing plant in Christchurch in 2018, they launched the Alfa Pet brand under their company Azure Group.

The company is currently in negotiations to sign a five-year lease before agreeing to purchase the property in Auckland to become the home of the company’s second processing plant. 

A million dollars will be invested into the new property, allocating $500,000 in the first six months to organise equipment and raw materials and the other $500,000 to come later this year will “boost capacity of the new plant”.

The company has 12 full-time employees in Christchurch and Auckland, and four new employees will work at the new plant by the end of 2021. 

Azure Group produced around 100 different pet food products under its Alfa Pet brand and sourced sea, game and farmed meats in New Zealand as well as kangaroo meat from Australia.

Alfa Pet products include three main meat categories: seafood, game meat and farmed meat.

“Raw material is the most difficult thing right now,” Huang said.

“Locally, we will stick with our suppliers, because we have worked with them for many years. In the meantime, we are thinking about more variety or combining the ingredients.”

Troubles with shipping ingredients to New Zealand during Covid had been felt by the industry, said Richard Brake of the New Zealand Pet Food Manufacturers Association. Although, he said New Zealand’s premium pet food was in a period of growth.

“The success of the New Zealand companies is being able to capitalize on the New Zealand strengths – the meat processing and the reputation for authenticity,” Brake said.

Around half of Alfa Pet’s sales were to the Chinese market and the remainder to Asian countries with less than 10% of sales being domestic. The focus on the Chinese market has intensified.

“I’d say raising orders from China will have a major impact on our business,” Huang said.

“China is the biggest purchaser of NZ products now if you read the data. And we are one of the factories benefiting from that.”

New Zealand’s pet food makers are attracting interest from global investors. New York-based investment firm KKR acquired Christchurch’s Natural Pet Food Group in early May.

Huang said Alfa Pet had received in recent years 13 approaches from mostly Chinese investors and one Japanese investor. The latest proposal from a Chinese investor was foiled by Covid-19.

“I think after Covid everything will resume to normal with funding projects later… If the price is right,” she said.

The company will start trialling exports to Chile and Canada by the end of the year.



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