China Feihe Ltd, a leading infant formula brand in China, has earlier announced that it will roll out a subsidy program aimed at improving birth rates nationwide. The program will offer expectant families subsidies of at least Rmb 1,500 (US$206.34).
This initiative is expected to be backed by a Rmb 1.2 billion (US$166.5 million) fund.
Unlike previous local policies that primarily address families with multiple children, Feihe’s subsidies will be available nationwide. The comprehensive support will extend to families expecting their first child, as well as to those with two or more children.
Feihe said, “The cost of raising children remains a major concern for families, and we hope these subsidies will encourage more parents to expand their families.”
The company is set to provide a suite of services alongside its financial incentives, including prenatal and postpartum consultations, breastfeeding support and expert-led parenting courses.
Feihe’s initiative aligns with broader policy trends in China, where several cities have recently introduced high-value subsidies from Rmb 10,000 (US$1,388) for one child to up to Rmb 100,000 (US$13,880) for families with more than 2 children over 5-10 years, to combat the ongoing decline in birth rates.
In 2024, China’s newborns increased for the first time since 2017, reaching 9.54 million. Much of this growth was driven by 3rd tier and lower-tier cities, where domestic infant formula brands, including Feihe, hold a dominant market share.
With Feihe’s core sales concentrated in these regions, the company is well-positioned to capitalize on the rising demand for infant formula, particularly the market for stage-3 formula, aimed at children over one year old, in light of the uptick in birth rates.
China’s infant formula industry is also undergoing a regulatory shift. The national standard for infant formula, implemented in 2023 alongside the second formula registration system, has significantly raised market entry barriers.
Companies must now provide detailed data on production processes and nutritional components. As a result, some smaller domestic players lacking R&D capabilities have exited the market.
Meanwhile, global and more established local brands like Feihe have rapidly expanded, launching new products with precise nutritional benefits targeting towards children at every stages of their life.
The market for infant formula is showing signs of recovery and growth in China, with major players like Danone, FrieslandCampina, Mead Johnson and Nestle already seeing signs of recovery in their sales.
According to iResearch, meticulous parenting has become the key force driving market expansion. The demand for quality and precise nutritional products from vision protection to immune boosting function for children is also rising among modern parents.
Zero Power Intelligence Group highlighted that the children’s milk powder market in China will continue to expand with a projected CAGR of 9% from 2025 to 2030.
