Kellogg's eyes China with cereal

Kellogg's will expand its range to suit Asian tastes

The world's biggest cereal maker Kellogg's has big ambitions to target China, a potentially booming market.

But typical western breakfasts, such as cold cereal with milk, are not popular in Asia, so the firm says it will tailor its products to local tastes.

The firm plans to buy a local, as yet unnamed, Chinese food firm and is looking at buying other local cereal and snack firms for regional growth.

The firm plans to double sales in Asia to $400m (£217.6m) by 2009 or 2010.

"People [in Asia] tend to reject cold breakfast or milk," said Hans Shin, president of Kellogg's Asia.

Subsequently the firm is considering developing cereal bars and hot cereals as well as whole-grain cereal, to respond to demands for healthier food from an ageing population.

Kellogg's dominates around 40% of the world cereal market and almost half of the market in Asia, but Asia still represents a mere 2% of its total sales.

"Apart from China, we are also considering buyout targets in Southeast Asia," said Mr Shin.

The firm said it would look at the possibility of building a new plant in China to add to its current plants in South Korea, Japan, Thailand and India.