Nestle, the world’s largest food company, announced on Wednesday that it will shutter or sell the Wyeth Nutrition baby formula factory in Askeaton, Ireland, no later than the first quarter of 2026.
The major reason given for this decision was that China’s birth rate has collapsed so much that the plant’s output, which was exported to Asia, is no longer needed.
“The number of newborn babies in China has declined sharply from some 18 million per year in 2016 to fewer than 9 million projected in 2023. The market, which had previously been reliant on imported infant formula products, is also seeing rapid growth in locally produced products,” Nestle stated.
The company said it would shutter a research and development center at the Askeaton plant by 2025, putting a total of 542 local jobs on the line.
“The full range of state supports will be made available to the employees, and we will examine each and every option to ensure that the best possible outcome is reached for all concerned,” Irish Minister for Enterprise, Trade, and Employment Simon Coveney told the BBC on Wednesday.
“During this consultation we remain open to approaches from a credible buyer,” Nestle added.
China officially conceded over the summer that its fertility rate dropped to an astonishingly low 1.09, possibly giving it the lowest fertility rate of any large nation. The health sciences dean at Peking University projected fewer than eight million births for 2023, an astounding number for an adult population as huge as China’s.
The Chinese government has tried various incentives to goose birth rates up, without much success so far. As the Nestle plant closure demonstrates, this demographic collapse in a major economy will have repercussions around the world.
“Pronatalist policy is having less of a stimulus effect on China’s falling birth rate than intended, as families that already have one child appear uninterested in raising more,” the South China Morning Post (SCMP) observed last week.
“Chinese parents are cautious about having more babies thanks to a number of factors, including high living expenses and education costs, despite recent incentives from local authorities ranging from cash rewards to home-purchase subsidies,” the SCMP reported.
Demographer He Yafu pointed out that China experienced a modest bump in birth rates after ending the hideous One Child Policy of forced abortions, but that bump is now fading, and further relaxation of the rules to allow three babies per family has not produced enough third children to make a big difference. This suggests the downward demographic trend could accelerate even further.
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