Dairy Industry Crisis: What Does A Better China Need?

By linduyichu (from image.baidu.com)

Mrs. Zhu lived with her husband and her 3-year-old son in Beijing. The little toddler hadn’t drunk any made-in-China powdered milk since he was born. All of his powdered milk was from a Netherlands-based company, Friesland-Campina, which was only sold in Hong Kong. During the past three years, his parents travelled all the way to Hong Kong, the city 1224.9 miles away from Beijing every several months, only to buy some bottles of the Netherlands-made milk products, or asked people who went to Hong Kong to purchase for them. Mrs. Zhu complained the high costs of shopping like this, but since she doubted the quality and safety of the milk powder products made in China, (seemly she even didn’t trust the foreign brands sold in mainland) she felt she had to do so.

I read this story from a news website, and then I searched online and found out that purchasing foreign brand milk powder from abroad is now a kind of a phenomenon among Chinese young mothers. It’s not just Mrs. Zhu’s one case.

Since the melamine tainted milk incident first brought the food safety of milk out of the surface, and was widely covered by the both domestic and international mainstream media in 2008, Chinese consumer’s trust on “made-in-China” dairy products, especially the ones for infants, has been vanishing. But Chinese consumer’s grudge against dairy industry is not from the bad memory of two years ago, but also from a similar safety issues occurred recently:  some rumors spread widely online by blog posts and news reports, saying that the milk products for children and infants, produced by two Chinese dairy giants, Yili Group and Synutra International, lead to kids’ premature sexual development, even the growth of breasts. The rumors had a huge negative impact on the two dairy companies, whose stock price immediately plummeted, but then it turned that the rumor was themed by another Chinese dairy company-also the largest one-Mengniu Group through PR agents, to revenge a similar smear planned by Yili and targeted at Mengniu in 2003.

The rumors have been clarified, but the negative impact on Chinese consumers cannot easily go away. Mengniu hoped that the smear could make its competitors crash down, but it didn’t realize that the negative information like this would also frighten the consumers, and bring shame on the whole dairy industry.

From image.baidu.com

But that is not the most important part. What really matters is not about the unethical company, or the ill-regulated market, or the fierce business competition, or the powerful PR manipulation with a wrong purpose. What really matters is how the dairy companies, or I should say the whole food industry in China, treats the consumers: the companies who produces food for the whole society don’t care the people they service. The only thing they care is the money-how to maximize the profits, how to enlarge the market, how to beat the enemies, and how to make people willing to pay for the products. The Chinese consumers-millions of young mothers, millions of innocent infants and millions of individual families-are just their tool to achieve the business goal, that’s why those companies could add toxic ingredient in spite of the life of millions of infants, that’ way those companies could use the rumors concerning millions of children’s growth as a weapon to fight against each other.

What a shame.

I read many reports, editorials and blogs about this smear scandal. Chinese experts and media generally urge that the business competition should be moderate and the industry giants should be trustworthy, while in the Western eyes this is just another case of the unregulated China. But for me, I feel like it is the time for the whole dairy industry to really take care of their consumers, those infants and toddlers who could not healthily grow up without good quality milk products, those mothers who love their kids so much that any illness the kids suffering could break their hearts, and those families which may lose the happiness and peace forever if their kids have any severe damage, rather than to focus less on coming up with another round of PR activities to save its own reputation.

A booming economy is supposed to lead to a better society, a society is surrounded by loves and cares, a society that people trust and respect each other. But our economy has been focusing too much on the rapid growth and has forgotten its mission to build a better society.

Let’s slow down the pace. Let’s retrieve the situation by facing the problems and solving them, rather than covering the mistake. Let’s pick up the oldest moralities that were inherited from our ancestors, to love, to care and to respect. Let’s promise not only a rich China, but also a better China.

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Lost Appetite for Farmer’s Market

By dianaoftripoli (Flickr.com)

The dream of Zhi Zhang, a recent graduate from Xi’an Technical Collage, is to be a white collar businessman. The 24-year-old man knows it is much harder to find a job than helping his father´s business, a vendor’s stand in a farmer´s market, but selling vegetables and meat isn’t attractive at all. He wants to be someone elegant, sitting in the office room and dealing with documents and files, rather than fishes and cucumbers.

I heard his story from my mom, who is a regular customer of his father. Every morning the middle-aged man loads all the food into his pedal-operated tricycle at 4:00 a.m., drives to the market at 4:30 a.m. and begins selling food at 5:00 a.m., when his son is still sleeping in the bed. The other farmers in the market are all in their 40’s or 50’s as well.

Farmer’s market is smelly, young Chinese would say. This generation who was born after the economy reform and opening up in 1970s, isn’t anything like their parents. They would rather pay more in Wal-Mart or Carrefour than go to a farmer’s market. They like more choices. For those who live in inland cities, supermarket is the only place they can find tropical fruits or seafood or even imported food. They also like the feeling of shopping in a large supermarket, where the fluorescent light is lighting the food up and the air conditioners cooling the room down, where fruits and vegetables are arranged orderly in the shelves, while pork, steak and fish are already cut into pieces and frozen in plastic box. It is easy, clear, and convenient.

So when these young Chinese graduate from college, get a decent job and become the main customers, supermarkets find their firm foothold in China. Within the past two decades, supermarket companies have turned themselves from an alternative food supplier into a big player in food industry, penetrating not only well-developed areas such as Beijing, Shanghai and Guangzhou, but also remote villages and inland towns. With 45,587 locations nationwide, the supermarket industry boosted its annual turnover of 710.47 billion Yuan, 12.2 percent of the total sales of retail market in China in 2008.

Supermarkets/hypermarkets in China

Yet young citizens are not the only ones that turn back on farmer’s market, local governments abandon it too. In September 2001, Beijing local government announced that the farmer’s markets would be moved out of 3rd Circle Rd, the dividing line between the downtown and the outskirt, within three years. In the same year, Fuzhou and Guangzhou local governments respectively disclosed their plans to turn local farmer’s markets into supermarkets.

I feel sad for Chinese farmer’s market, which has been serving fresh food for China over the past four decades and providing millions job opportunities for people who migrate from villages to cities. But no one can help the market before solving its stubborn problem – food safety. Intensively issued by Chinese mainstream media in recent years, vendors selling meat are notorious for smearing pork with a chemical power to keep the meat fresh, and injecting water to make the meat weigh more, while peddlers selling vegetables and fruits are marked as “pesticide infectors”. In comparison, supermarket companies always have their regular chains of purchasing the food, and pay more attention to the food safety to build their brand reputation. No wonder Chinese favors them.

But even so, the Chinese farmer’s market is not dying. The regular customers of individual vendors, like Zhi Zhang’s father, are still in a big amount. Since the total cost of running a food stand in a farmer’s market, including rent, labor, maintenance and repair, is minimal, their food prices can be very competitive. A survey of thousands of Beijing citizens conducted by Beijing Industrial and Economic Bureau shows that the lower income households under 1000 Yuan income per month, or 148 US Dollar, only purchase in farmer’s market, while the lower-middle income households with an average income of 3000 Yuan per month, or 444 US Dollar, frequently purchase food directly from farmers as well. The main format of fresh food supply in China in 1970s is becoming an alternative market for cheaper food.

Rumors are saying that the local government is going to turn the land near my community, including the farmer’s market area, into a green belt. But it doesn’t matter for Zhi Zhang, who has packed the luggage and headed for job opportunities in big cities, where are crowded by the same ambitious young Chinese. It even doesn’t bother his father. With no successor come after, the vendor is going to retire very soon.

Goodbye to the farmer’s market, and good luck for the young man.

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