We recently had the pleasure of meeting with Chenggang Han, the General Manager of Canada Royal Milk, to discuss their innovative new state-of-the-art facility and the company’s broader vision. This cutting-edge establishment is a testament to Canada Royal Milk’s commitment to excellence and sustainability in the dairy industry. Their dedication to producing high-quality dairy products showcases their technological advancements and aligns seamlessly with their mission to provide nutritious and delicious options to consumers around the globe.  

OU Kosher: Han, first, can you give us a short overview of your organization and products?  

Canada Royal Milk: Yes.  We are essentially a dairy processing company in Canada. We currently have two local brands: Capris, which is an adult goat milk powder sold in the Canadian market, and Niuriss, an infant formula brand that’s goat milk-based and will be sold in the Canadian market as well. 

OU Kosher: So to clarify, you’re not selling services to other formula brands, you’re manufacturing your own brand right now, correct? 

Canada Royal Milk: Yes, that’s correct. And to clarify, in-house and co-manufacturing is processed in our facility.  

OU Kosher: I understand that you process and sell Goat Milk. Is there any sort of obstacle in terms of building trust among your market consumers? 

Canada Royal Milk: Actually, our goat milk product is for adults, not for infants. Our infant formula is produced with cow milk. 

OU Kosher: Can you talk a little bit about the adult formula, how you source the goat milk? 

OU Kosher: Have you had to do much education and awareness among consumers about the benefits of goat milk? 

Canada Royal Milk: It’s common knowledge that goat milk has a smaller molecule size, which makes it easier to digest compared to cow milk. The goat milk is from Ontario, from OGDC, which is a goat cooperative. 

OU Kosher: And you do all the processing in your factory? You get the raw goat milk and turn it into a powder? 

Canada Royal Milk: Yes, we collect the raw milk and turn it into a powder. 

OU Kosher: What sort of response have you had from the community or from consumers about goat milk? Are there any other competitors using goat milk in their formula? 

Canada Royal Milk: Actually, in Canada, there are a few different brands. Some of them are from the US and some from Canada. 

OU Kosher: So both of your goat milk formulas are being sold in Canada only? 

Canada Royal Milk: Yes. 

OU Kosher: Can I ask you about kosher certification? Why did you decide to get kosher certification? 

Canada Royal Milk: As a Canadian company, we fully respect the diversity of our customers. We believe it’s our responsibility to meet the requirements of different consumers, and kosher certification is one of them. 

OU Kosher: Why did you decide on OU Kosher versus other certification agencies? 

Canada Royal Milk: We did our investigation and found that OU is the most popular certification organization in the North American market. 

OU Kosher: Are you planning to expand into the US, or will you stay in Canada for the long term? 

Canada Royal Milk: We have plans to expand to the US, but not within the next year. 

OU Kosher: I imagine the regulatory process in the United States is complicated. Would you have to go through that process? 

Canada Royal Milk: Yes, we have to go through the entire certification process with the FDA to get the license. This typically takes about two years. 

OU Kosher: In terms of product development, are you always developing new products or changing your formula, or is it set once it’s developed? 

Canada Royal Milk: We have our own R&D team. We develop products according to the market situation, regulatory references, and local market needs. If a new product idea is feasible, we move forward with it. 

OU Kosher: What sort of feedback have you received from your consumers so far? 

Canada Royal Milk: For example, our Capris brand is already the number one goat milk product on Amazon.ca, with a review rating of around 4.6. So far, the feedback has been good. 

OU Kosher: Are you doing a lot of paid advertising in Canada right now? 

Canada Royal Milk: No, not really, because we are a new brand with a new product. We have spent some on advertising, but almost nothing significant so far. 

OU Kosher: So you’re saying you’ve gotten to where you are on Amazon primarily through word of mouth, without much advertising? 

Canada Royal Milk: Yes, people are seeing it in stores on all the shelves in Canada. We also have an Amazon store with dozens of subscriptions and repeat purchases. 

OU Kosher: That’s quite good. Are you in all retail outlets in Canada, or is your product mainly sold online? 

Canada Royal Milk: We have offline sales as well in Eastern Ontario, and we will expand to Western Canada later this year. 

Canada Royal Milk: We are both online and offline. Some of our consumers prefer to subscribe once they like the product. 

OU Kosher: Are your competitors mostly selling online or in retail for goat milk products? 

Canada Royal Milk: Almost all competitors sell online only. It’s a small category, so consumers specifically look for goat milk because they understand its benefits. 

OU Kosher: Can you talk a little bit about your sourcing? I read that you’re getting goat milk from Quebec and Ontario. 

Canada Royal Milk: We are just getting goat milk from Ontario because Quebec is short of raw goat milk, so they don’t have enough for us. 

OU Kosher: I imagine your relationships with goat milk producers are very important. Do you have a team managing these relationships? 

Canada Royal Milk: Yes, we have a supply chain department working well with the cooperatives. 

OU Kosher: In terms of sustainability, do you do any messaging about your sustainable practices? 

Canada Royal Milk: We have a carbon reduction plan each year. For example, we reduced our natural gas consumption by around 22% last year. We also have a power consumption reduction plan that we are implementing. 

OU Kosher: I saw some pictures of your plant. Are you doing anything differently than other processors? 

Canada Royal Milk: It’s common practice in the dairy industry, but we are more highly automated, which increases efficiency. 

OU Kosher: Have you reduced water usage? 

Canada Royal Milk: Our water consumption is not that high. We have a water reduction plan starting next year because our utilization has not been high in the past three years. We worked with Ecolab, who gave us strategies to reduce water consumption, and we’ve implemented over 70% of their suggestions. 

OU Kosher: Regarding your kosher certification, is the kosher symbol prominent on your labels? 

Canada Royal Milk: Yes, it is. 

OU Kosher: Do you have any data on how you’re doing within the kosher consumer market? 

Canada Royal Milk: We have not done special marketing for different consumer groups. Our strategy is to respect the diversity of our consumers and fulfil their demands. 

OU Kosher: What is the sales split between infant formula and adult formula? Is infant formula a much bigger market? 

Canada Royal Milk: Yes, in North America, adult formula is a niche market. Local consumers prefer liquid milk. For infants, formula is a necessity due to the low breastfeeding rate, which is below 50%. 

OU Kosher: You have significant competition in Canada for infant formula, correct? Can I ask how you’ve been able to differentiate yourself from your competitors, considering you are the only company using formula products manufactured in Canada with Canadian milk? 

Canada Royal Milk: I think that’s almost enough to differentiate ourselves from the others. The fact that we’re local, Canadian-operated, and use Canadian milk increases trust by definition. Our factory is operated by Canadians and we use Canadian milk. 

OU Kosher: So you are the only Canadian manufacturer of infant formula? 

Canada Royal Milk: Yes, we are. 

OU Kosher: Are you collaborating with any other companies at this stage, or is everything from production to marketing strictly in-house? Do you have any plans to take on co-manufacturing business in the future? 

Canada Royal Milk: Currently, everything is done in-house. However, we might take on some co-manufacturing business in the future. 

OU Kosher (Rabbi Stareshefsky, account manager): Han, I wanted to jump in here and ask you a question. I see that you produce non-fat dry milk powder, both cow and goat, as well as bulk cream. You’re not certifying those products because you’re focusing on retail, not industrial. The OU can certainly help you with that. 

Canada Royal Milk: Yes, currently we are not certifying those because we are focusing on retail. However, the OU can indeed play a big role if we ever choose to focus on industrial products. 

OU Kosher (Rabbi Stareshefsky, account manager): As Gary mentioned, we have two target audiences for this interview: industrial OU companies and retail consumers. Although you are currently focusing on retail, we can also help you with industrial products and marketing. 

Canada Royal Milk: Actually, for the skim and cream parts, we might take on some local co-manufacturing business. We just do the processing for them under their brand and packaging. 

OU Kosher: Would you call that private label for industrial processing? 

Canada Royal Milk: Yes, it’s just processing under their label. 

OU Kosher: Thank you for your time. We welcome more entrants into the market. We’re excited to see how you continue to innovate and grow in both the retail and industrial markets. We look forward to supporting your plans and helping you expand your reach within the kosher consumer market. Thank you again for your time. 

Canada Royal Milk: Thanks to you for featuring us.