China Shengmu to renew key supply, processing deals through 2028

China Shengmu Organic Milk Limited will hold an Extraordinary General Meeting on December 30, 2025, to seek shareholder approval for two significant continuing connected transactions. The first is the renewal of a raw fresh milk supply framework agreement with Inner Mongolia Mengniu for a three-year term from January 1, 2026, to December 31, 2028. Proposed annual caps for this agreement are RMB3,500m for 2026, RMB4,000m for 2027, and RMB4,500m for 2028. This renews a prior agreement, ensuring stable sales and cash flow, with the group committed to supplying over 80% of its raw fresh milk to China Mengniu.

The second transaction involves a new products and services supply framework agreement with Dabeinong Group and Yiyingmei Dairy, also for a three-year term starting January 1, 2026. This agreement covers the procurement of various products, including feed and milk powder, and processing services for milk powder. It consolidates previous agreements, with proposed annual caps for Dabeinong Products (materials and milk powder) at RMB415m for 2026, RMB430m for 2027, and RMB445m for 2028, and for Yiyingmei Processing Services at RMB17m for 2026, RMB11m for 2027, and RMB11m for 2028. These transactions are designed to enhance supply chain efficiency and product quality.