Yu Linlin, a typical Beijing mother, never takes risks with and always tries to provide the best care for her threemonth-old baby. Scrutinizing every decision, from what clothes to put on her baby during the hot summer months to what kind of toys to let him play with, she is never quick to act, but always considering every possibility for her infant. When it comes to baby formula milk, she is particularly cautious—Chinese companies have a tainted reputation for distributing equally tainted products in recent years.
　　“Each month, my family spends around 800 yuan ($126.4) on formula milk powder. We’ve decided that Karicare from New Zealand is the best option for our baby,” said Yu, adding that a friend in New Zealand sends the milk powder to Beijing about once a month. “I’d never let my little boy drink domestic infant formula powdered milk. It’s just too risky and I don’t trust them.”
　　Zhao Hong, another average Beijing mom, agrees with Yu. “I only have one child. She’s all I have. What if something happens after she drinks domestic substandard formula milk? Who will shoulder the responsibility? I will never take this kind of risk,” said Zhao.
　　Since 2008, China has been rife with food scandals, many involving infant milk formula powders from some of the country’s top dairy producers. The result has been a sharp drop in consumer confidence in domestic brands as they look to overseas companies to fill the void.
　　Losing the market
　　In 2008, six infants died and about 300,000 others fell ill after drinking melamine tainted milk, according to data released by the Ministry of Health. Former dairy giant Sanlu Group, based in north China’s Hebei Province, and 21 other dairy companies were found to have contaminated their products with melamine, a chemical that could cause kidney problems.
　　The scandals and families’ increasing incomes as China develops a middle class have caused many Chinese families to turn to high- end foreign formula milk powder.
　　China imported 140,000 tons of milk powder in 2008. That amount jumped to 650,000 tons in 2011. To date, the market share of foreign brands has surpassed 60 percent, according to China International Dairy Trade Association.
　　“In first-tier cities, the market share of domestic brands of formulas is only 2 percent,”said Wang Dingmian, Director of Guangzhou Dairy Industry Association.
　　After the melamine incident in 2008, China’s dairy giants, such as Mengniu, Yili and Sanyuan, expanded their production of and investment in formula milk powder. But they are apt to bypass competition against foreign brands in first-tier cities, and choose to explore second-tier and third-tier cities.
　　With the increasing demand for foreign brands, the price of imported formulas has enjoyed an average increase of 15.5 percent per year for the past six years, although the price of raw materials for the production of infant formula milk powder has been declining con-tinuously, according to People’s Daily.
　　Price hikes have given foreign milk powder producers a higher profit margin in the burgeoning Chinese market. The average gross profit margin of imported formulas has surpassed 50 percent in China, according to a report issued by CIConsulting, a leading industry research institution in China.
　　“The gross profit margin of foreign formulas can reach 60 percent or 70 percent, and even as high as 80 percent. In comparison, domestic brands can only have a 40-50 percent gross profit margin,” said Wang.
　　In sharp contrast with the prosperity of foreign brands, the market share of China’s domestic formula milk producers tanked to less than 40 percent in 2011, against 60 percent prior to the melamine scandal in 2008.
　　Trying to recover
　　On May 27, the China Dairy Industry Association released a report on the quality of infant milk powder, pledging that the current security and quality of domestic dairy products and infant formula milk powder are in the best period of their history, after years of concerted efforts by concerned departments.
　　The Chinese dairy industry has seen a fundamental shift since the melamine incident in 2008. It has been cleaned up, the implementation of the licensing system has been rectified and product monitoring checks have also improved, said Song Kungang, head of China Dairy Industry Association.
　　Over 99 percent of randomly checked samples passed testing. Many efforts and new moves in the dairy industry have brought this change. First, the newly revised standard for infant milk powder is China’s fourth-generation standard. It is technically advanced and also one of the most stringent standards in the world. Second, raw materials have been protected in quality and safety. In addition, advanced processing technology and equipment, perfect quality assurance system and improved national regulation have also provided support to the industrial change, according to the report.
　　However, whether Chinese consumers will ever trust domestic brands again remains to be seen. Experts suggest there are two methods to rebuild that trust: First, the standard of domestic infant formulas should be enhanced to meet the international level; and second, a more transparent and open supervision system must be established to give consumers more confidence in the long run.
　　While infant formula milk powder is produced and supervised as medicine in many other countries, China only takes it as an ordinary kind of food to produce and inspect. Therefore, many safety scandals occurred in the sector, just as in many other kinds of food. The infant formula milk powder deserves a higher standard in China.
　　Ding summarized the situation of China’s infant formula milk powder as “the wrong national standard, wrong management system, wrong threshold for market entry, wrong label and wrong recall system for substandard products.”
　　“I’ve been calling for the enhancement of the standard of infant formula milk powder in China for more than a year,” said Ding Zongyi, Director of the Child Health Committee under the Chinese Medical Doctor Association. “China’s standard for infant formulas has a long way to go to meet internationally applied standards.”
　　“China’s national standard for infant formula milk powder is too low. It doesn’t require opinion of pediatricians. In terms of grasslands and cows, it doesn’t demand a scientific management system. As for the later production processes, it only inspects it as ordinary food. The reasons for those safety incidents lie in the low standard and little cost for violation of the standard,” said Ding.
　　Wang agrees with this idea. He criticized that China’s standard for infant formula powder milk is the lowest worldwide.
　　“If the standard remains too low, consumers will turn to higher-standard foreign brands,” said Ding.
　　Besides the widely criticized too low standard, the supervision system is another appeal for the improvement of the whole industry. Only by establishing a stricter examination system can consumers gradually begin to retrust domestic brands.
　　Any industries concerning infants and toddlers should be heavily monitored. Consumers are most interested in seeing regular, specific and scientific supervision measures, including when concerned departments will make sample inspection on infant formula milk powder producers, who will be responsible, how many brands are involved, how many items should be examined and when the report should be released. The government disclose all misdeeds and corresponding punitive methods in time. Regular monitoring also means long-term, open and transparent release of information, especially when safety incidents occur in dairy giants, said China Business Daily.