The Land of Milk and Money 牛奶和金钱之乡

Apologies for the hiatus! During the blogging interlude, I have decided on the topic of my dissertation; milk in China! Those of you who know me well, know that I dislike milk and I have a little bit of a sulk every time a coffee shop charges me extra for ordering a latte with soy milk. But I've found the topic of the growing milk industry in China fascinating; it sums up China's increasing interaction with the world as well as its own growing pains. It is an industry peppered with incidents and scandals, that is, in turn, sharpening the awareness of the Chinese consumer. 

I have just written an article for Qingdao magazine about the issue, as well as a fun 'infographic' for extra facts about the milk industry (click here for the June issue, my article and infographic is on pages 6-9). Alternatively, read below for the unedited article (last paragraph was perhaps too subversive to be published in the mainland). 

Ai Weiwei's map of China, made with over 1000 cans of foreign infant formula

For most part of recorded history, the Chinese relationship with milk can be summarized by the word ‘avoidance’. The History of the Former Han Dynasty, written in 82 AD, tells of the Han princess Liu Jian sent to marry the king of the Wusun tribe. Her poem laments the changes in her lifestyle and longs to return home.

吾家嫁我兮天一方，遠托異國兮烏孫王。

穹廬為室兮旃為牆，以肉為食兮酪為漿。

居常土思兮心內傷，願為黃鵠兮歸故鄉。

My family married me off, to somewhere under the sky.

I moved to far away foreign lands, to the King of the Wusun.

I have a yurt as a room, cloth as my walls.

I have raw meat as food, curled milk as broth.

I often think of my native land, how my heart aches.

I would that I were a yellow swan, to fly back to my home.

The yurt and cloth walls are at odds the Han way of life. Similarly Liu Jian’s poem presents curled milk as antithetical to the typical ‘Han’ diet, where soybeans provided an alternative. Farming cows and drinking milk was seen as barbaric, as the sustenance of nomads. And so, this attitude continued for centuries. 

Only within the past 40 years or so have attitudes begun to change in the wake of globalisation. Milk and dairy began to creep onto breakfast tables and into fridges. Even the founder and chairman of milk behemoth China Modern Dairy, Deng Jiuqiang, admits that, “China has a short history of dairy.” Back in 2006 Premier Wen Jiabao stated, “I have a dream, that every Chinese, especially children, could have 500grams of dairy products every day.”  While Wen's dream might not have been as profound as Martin Luther-King's, his ‘500g Dairy Declaration’ has taken hold. The elder generations may prefer to stick to tofu, but there is no escaping dairy in modern China. Anyone who has been to a Chinese supermarket has heard the furor surrounding the milk aisle, as shop assistants brandish their tubes of yoghurt at you like lactic swords. 

Dairy has swept China. And it is still a growing market, worth $32billion and counting. The average Chinese consumes 2.5 gallons of milk per year, less than a third of the average Japanese or South Korean. Forecasts predict the demand for dairy will continue to grow as urban populations swell and incomes increase. 

However, meeting the demand has proved to be an issue for China’s domestic milk producers. In 2008 the milk supply was not enough to meet the market’s demands. Preoccupied with inflation, the government forced milk producers to maintain artificially low prices. To balance overheads, milk was diluted with water and melamine powder was added to raise the protein content. As a result of the melamine, 6 babies were killed and a further 300,000 hospitalised with kidney problems.

While the melamine scandal of 2008 received widespread international and domestic condemnation, it is not the only scandal to have hit Chinese dairy industry in recent years. The Fuyang Milk Powder Incident in 2004 and the Sanlu Milk Powder Incident in 2008 both caused significant dips in the formula milk market. The Chinese dairy companies Mengniu and Ava Dairy have recalled baby milk powder over fears of high amounts of aflatoxin. Last June, Yili Group, issued a recall after its infant formula was found to contain "unusually high" levels of mercury. These incidents have severely affected consumer confidence in homegrown brands.

In response to the melamine scandal, the government quickly implemented measures to help ensure the safety of domestic milk. Small farms were shut down in favour of group facilities and large farms, where produce can be inspected and monitored more easily. The government even meted out the death penalty to those guilty of manufacturing toxic protein powder.  

Yet the reputation of domestic dairy brands still suffers. Chinese consumers, desperate to purchase safe milk for their children, are turning to imported foreign brands in the hope of ensuring product quality. Foreign brands of infant formula sold on Taobao can fetch over double their original retail price. Evidently, milk powder has become a lucrative market for those with the right foreign connections. This has lead to Hong Kong, the UK, the Netherlands, and Australia imposing restrictions on infant formula as a means to stop mainland Chinese from bulk buying. 

Optimistic Chinese companies are confident that it will not be long before the demand for milk can be met by domestic producers. In 2011 China spent $250million on importing shiploads of cattle from Australia, New Zealand, and Uruguay. Thousands of tonnes of bovine semen were also bought from America. The hope is to scientifically breed a more productive herd, as a Chinese heifer produces less than half the milk of its American cousins.   

If the Chinese dairy industry wants to overcome the suspicion surrounding its quality, it will have to wean itself off the produce from small farms rather than mudslinging at its foreign competitors. Building a large scale, accountable industry will take time, as will casting off the shadow of various scandals. As for the Chinese people, crying over spilt milk does have a purpose. The voice of the Chinese people crying out in complaint is the strongest method to ensure their food safe is for consumption.