China's new baby formula rules could block 50 Kiwi exporters

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As many as 50 New Zealand baby formula exporters look set to be blocked from exporting their products to China.
 
This follows a Chinese audit of New Zealand’s $200 million infant formula industry last month.
 
Infant milk formula has become white gold in China and more than 100 New Zealand based export companies have sprung up to cash in.
 
But food scares have China increasingly worried about product safety and it is imposing tough new rules from next week.
 
Food Safety Minister Nikki Kaye say it’s «really positive» that China has been making changes over the last 12 months to lift its food safety laws.
 
The Chinese audit has found 12 of New Zealand’s 13 major baby formula makers do not meet all the rules.
 
However, the Government is confident it can get them to comply in time.
 
«We’ll be sending a high-ranking official up to China in next couple of days to work on some of the issues that we believe some of our brands manufacturers will have,» says Nathan Guy, Primary Industries Minister.
 
The 13 manufacturers account for about 90 percent of the $200 million infant formula trade.
 
It’s the remaining 10 percent, or about 50 companies, where the real problems lies and many of those now face an uncertain future.
 
«The bottom end of town, the small medium exporters, there is going to be some casualty,» says Michael Barnett, New Zealand Infant Formula Exporters Association chairman.
 
Mr Guy says: «There will be probably some small players that may not get across the line.»
 
Brand owner responsible
 
China’s new rules are about brand owners’ control. In practice that will mean a brand owner is responsible for their infant product’s formulation through to manufacturing. And there will be no access for companies which can’t prove that kind of control.
 
Mr Barnett says the Fonterra botulism scare identified a weakness in the market.
 
«What we need to understand is that every Chinese official is sitting over there and he is butt covering.»
 
The Government insists China’s new regulations are not a result of the botulism scare.
 
«This was well indicate previously, right back to April last year, in June, that China wanted to make these changes. So you can’t correlate Fonterra’s issues to do with botulism and China strengthening up its infant formula market,» Mr Guy says.
 
ONE News political editor Corin Dann says the bottom line is that it seems for some Kiwi companies, China’s lucrative infant formula market is going to end.
 
Source: TVNZ

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