Milk powder, a lucrative market
At that time, Beijing accounts for its milk power imports to $17 billion annually, equivalent to almost two-thirds of the global market. China imports mainly from Germany, where the price of milk is significantly higher in the Chinese market than in the European. Moreover, Euromonitor predicts that the market will double again in the next three years. Even on retail sales, prices appear vulgarly inflated.
Ireland presents a new measure on breast milk
Ireland plans to establish a measure on infant formula and aims for 50% growth in milk production by 2020, it is the most ambitious measure among those existing within the European Union. It is based on the seemingly unshakable assumption that the Chinese demand for infant formula is supported by fundamental changes in Chinese society. The relaxation of the one-child policy, the scandal of melamine poisoning in 2008, and the increasingly affluent middle class pushed forward the rise of the demand for milk powder, which has increased tenfold in less than a decade.
The Kerry Group has recently launched a formula under the brand Green Love More from retailers for a strong price of 43 euros per kilo, which is four times more than Irish prices. However, running in parallel with these impressive statistics is a growing concern about the low rates of breastfeeding. Indeed, less than a third of babies are breastfed in China and the number is decreasing despite the fact that global health organizations recommend this practice for babies under six months.
More controls since the scandal of 2008
Before the age of 6 months, the breastfeeding rate is about 28%, slightly less than in the city, and most in rural areas. Chinese law is respectful of maternity leave: four months off work are awarded to the young mother. It may take an hour a day during their working time for 6 months to breastfeed upon return to the office, the girl often stops after 3 months. That explains the high demand for breast milk and this is why China is the world market of manufactured milk. Since the scandal of 2008, China has strengthened its health checks on dairy products. Indeed, obtaining authorization to produce and market milk became highly controlled: a government agency audits today all manufacturers in China and abroad. No less than thirty-seven points are checked throughout the process, the majority to verify the quality standards and according to precise formulas and validated by the Ministry of Health, almost more drastic that the current European standard. In Shanghai, we can find some European brands like Danone.
The decision of the Chinese government
In order to answer this problem, the Chinese authorities have now taken into account the prohibition of advertisements for breast milk. The proposed measure provides for the prohibition of advertising in the mass media or in public places for dairy products, drinks, or other food products that “claim to partly or fully as a substitute for breast milk.” Behind China’s growing appetite for the formula are some disturbing truths. Experts say that sales of the preparation of powdered milk are explained by a lack of access to maternity leave and because some people claim that the marketing of breast milk for prepared children is “unethical “through the maternal care system.
The Chinese government is now committed to increasing the exclusive breast milk rate to 50% in 2020. Nevertheless, experts say that even a tiny piece of powdered milk in the Chinese market will be enough to justify the measure proposed by Ireland.
With more space for mass media, the digital master will rule the breast milk market in China. If the Chinese simply cannot be reached by a traditional media campaign, the pre-existing phenomenon of hyper-digitalization of Chinese consumers here will strengthen. Indeed, digital offers a wide variety of tools and places where consumers can learn … and be targeted at a digital marketing campaign.
the issue is milk powder export to china