China Dairy Group says the group expects to register a net loss for 3Q FY2010 and FY2010.

Earlier in August, the group had reported a consolidated loss for the first half year ended 30 June 2010.

As disclosed in the results announcement on Aug 11, the rising prices of key raw materials will continue to exert pressure on the group’s profit margin in 2010. The company had also anticipated that competition in China milk industry will remain intense.

Now, the group expects additional loss as the products of Silver Bridge Dairy (Tianjin) Co., one of the wholly-owned subsidiaries did not meet the company’s quality standards and will be written off.

Additional expenses are also expected to be incurred.