From nation, page 9, issue 386, Sept 22, 2008
Additional research and translated by Zuo Maohong
Original article: [Chinese]
When Li Jie first took charge of the laboratory unit at a Heilongjiang-based dairy company seven years ago, there were far fewer potential contaminants listed for testing; but now the list had expanded to 21 items, with melamine as the latest newcomer.
Melamine has become a household name in China of late after the tainted infant milk formula scandal exposed. This white crystal compound is a chemical used in a variety of industries, including plastics, pigments, paper, textile and leather.
The last time it caused public concern was in March last year, when the US Food and Drug Administration (FDA) discovered melamine-tainted pet food imported from China had sickened cats and dogs. Laboratory investigations then found that excessive intake of melamine would cause bladder stones, and could worsen into cancer.
Li had long opposed the grading of milk quality through conventional testing, which measured the level of protein by testing how much nitrogen the milk contained. As nitrogen made up 66% of melamine, by adding the latter to watered-down milk could artificially boost up the reading of protein content.
The testing method was mainly adopted by dairy companies that sourced milk from individual dairy farmers or dealers, as a prevention measure against milk being adulterated by mixing in too much water.
"We know that in the past, some farmers had added urea (which can be found in mammal's urine) into milk to artificially boost protein reading. If we used the conventional testing method, it would only encourage such malpractice," Li reasoned, adding her company had its own dairy farm and thus adopted testing for potential contaminants instead.
"Somehow, people can always bring forth new ideas in faking," Li said, adding to identify undesirables in milk was technically challenging, as most companies could only establish a list of potential contaminants and test for them; but that was not a foolproof method as the list could not be all-encompassing and new substance could crop up over time.
Risky Milk Source
Zhang Zhongyuan (anonym) owned some 100 cattle. He raised them on a farm which the above-mentioned dairy company contracted, but the milk his cattle produced wasn't always sold to this company.
According to state media Xinhua, China's milk production had seen an average yearly growth of 23% since 2000. In 2006, milk production reached 30 million tons, ten times of the volume a decade before.
The rapid growth had led to the battle for milk source became fiercer. "One who wins the milk source wins the battle" had become the motto of the industry.
Big companies placed their bet on milk collection stations. Some built their own stations, others contracted stations for supplies. The former meant higher investment in the initial stage, while it would cost less to source from existing milk stations.
For dairy farmers, they preferred a simple sale-and-purchase agreement with dairy companies than signing a contract that bonded them to one client, Zhang said.
By not having a contract, he explained, farmers could avoid direct control and possible punishment from the company concern when a quality problem cropped up; and more importantly, they could choose the best offer.
Even if a farmer was contracted as an exclusive supplier, he would still secretly sell his milk to others when the price was right, Zhang said, adding this provided opportunity for milk dealers.
Zhang claimed he had never dealt with any dealer, as he suspected dealers would almost certainly adulterating milk for higher profit margin.
Yet he had sold milk to clients other than his contracted company, and such dealing could only be conducted secretly or local authorities might intervene.
He explained that dairy companies were the source of tax revenues for local authorities, who in turn would protect the interests of the companies under their geographical jurisdiction. He called that local protectionism.
For instance, the above-mentioned Heilongjiang-based dairy company had once sent its milk collection team to source for supplies from a Yili Dairy Group contracted milk station in another region.
The expedition ended disastrously with the company's vehicle detained by that region's local authorities, and all the milk purchased were returned to Yili.
Ignorance is Bliss?
The Heilongjiang-based dairy company's milk sourcing director Yang Yuhong said her company had never dealt with dealers but sent its own milk collection team to acquire supplies from farmers.
No melamine was found in any of the company's products during recent inspections performed by the government quality control agency.
Yang said if the milk brought back to the company was found to be problematic during lab test, the company's sourcing staff would be held responsible and fined. Yang added the highest penalty she had dished out last year amounted to 10,000 yuan and the bad supplies were disposed of.
"Anyway, milk dealers won't come to us because our offer price is even lower than their cost," she said.
However, the lower the price a dairy company offered, the more likely for farmers, especially the independent ones, to sell their milk to dealers.
That opened up room of survival for dealers, and dealers always had a way to "process" the milk to remain profitable, though the selling price might not be higher than the standards set by dairy companies.
The dealers were usually locals, and were thus familiar with dairy farms and their owners. Though many big companies refused to do business with them for fear of poor quality, they still thrived due to the existence of small companies that could not afford to set up their own farms or milk collection stations.
According to available open data, in some provinces, dairy companies bought some 40% of their milk from individual dairy farmers or dealers. After the tainted milk scandal broke, police in Hebei province had arrested at least 12 dealers for allegedly adding melamine into milk supplies and sold them to dairy companies.
To guarantee the safety of milk should include three phases: monitoring the milking process, testing the supplies at milk collection stations, and testing at the laboratories of respective dairy companies.
Milk purchased from dealers lacked supervision in the milking process; and owing to the difficulty in finding out unsuspected contaminants in milk, testing in the later phase might not help to reduce the risk.
If the current milk sourcing and supervising system was not revamped, consumers could only pray that there wouldn't be a substitute for melamine in the future.
As cattle farmer Zhang lamented why Heilongjiang province was spared in the latest melamine-scare? Perhaps it was because the local industry players were still ignorant of melamine. "We have never heard of it before," Zhang said.