Bloomberg News

China Starts National Food Safety Checks on Dairy, Cooking Oil

October 26, 2011

Oct. 26 (Bloomberg) -- China has started nationwide food safety checks as the government seeks to ease concerns about the quality of milk, pork and cooking oil.

The campaign will include checks on milk powder, on the use of additives and cracking down on the sale of cooking oil reprocessed from restaurant waste, the People’s Daily reported today, citing the State Council’s food safety committee. The newspaper is published by China’s ruling Communist Party.

China’s government has pledged to improve food safety after tainted milk powder killed at least six babies in 2008 and cases of additives in pork, chemicals in steamed buns and excessive bacteria in duck spurred public outrage. Since the end of June, authorities announced campaigns against reprocessed oil, illegal food additives, unregulated hog slaughter, and an effort to improve food safety at school canteens.

“What’s different about this is that it’s a high-level initiative aimed at ensuring that China’s food safety environment becomes safer, sending a strong signal to local governments to carry out responsibilities more systematically,” said Berenice Voets-Berouti, head of public affairs consultancy APCO Worldwide’s Greater China food and consumer products practice.

The food safety committee is headed by Vice Premier Li Keqiang, who is in line to become the next premier of the world’s second largest economy. Creating a committee on such a high level shows that the government is putting in significant effort into addressing food safety, Voets-Berouti said.

Fragmented Industry

The highly fragmented nature of the food industry, where there are more than 100 sub-sectors, makes enforcement and execution difficult, said Selina Sia, a consumer industry analyst with Mirae Asset Securities in Hong Kong, who covers companies such as China Yurun Food Group.

“These improvements will take time, and will need to be step by step,” said Titus Wu, a consumer industry analyst with DBS Vickers in Hong Kong. Consumers are exercising heightened caution and awareness, will “vote with their money” and won’t buy a product if there is a perception of problems, he said.

Packaged foods such as milk and snacks are more easily regulated as they are usually produced by big factories and companies, Wu said. For fresh food, which are not distributed through modern trade stores, it is a harder platform to be regulate.

Earlier this month, crackdowns on Wal-Mart Stores Inc. China and mislabeled pork in its Chongqing stores resulted in the temporary closure of 13 outlets. Ed Chan, president of its China operations, resigned for personal reasons, the company said.

In April, China’s Premier Wen Jiabao said in a speech that the country’s “pernicious” food safety incidents at the time reflected a “severe” lack of integrity and morals. The country opened a government-funded center to offer technological support for monitoring food security risks and food safety standards on Oct. 14.

--With assistance from Regina Tan in Beijing. Editor: Frank Longid

To contact the reporter on this story: Natasha Khan in Hong Kong at nkhan51@bloomberg.net

To contact the editor responsible for this story: Stephanie Wong in Shanghai at swong139@bloomberg.net


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