April 20, 2006

Nearly half of China's consumers doubt quality of its dairy products

China's dairy companies need to pay more attention to the safety of its dairy products if they want to further develop the industry and gain the trust of consumers, a Chinese economist said at the International Conference on Livestock Services in Beijing.

Quoting a survey of Chinese dairy consumers, Zhang Yunhua, a researcher with the Development Research Center of the State Council, said that about 44 percent of Chinese consumers have doubts over the quality of the dairy products in the country and 45 percent do not believe dairy producers can provide a safe dairy supply chain.

Many safety issues arising from domestic dairy companies have been exposed in China in recent years, said Zhang, adding that the safety issue would greatly impact the growth of China's dairy industry.

In his speech, he also urged the government to improve the food safety administration system to create a better environment for the domestic dairy companies.

Chinese dairy companies have applied for various food safety certificates in recent years, but sometimes these certificates lack creditability, said Zhang.

Analysts believe China's dairy output would rank third in the world by 2020, behind India and the United States.

Total production of milk and milk products reached 23 million tonnes in 2004, more than double the level eight years ago, according to Liu Chengguo, president of the Dairy Association of China.

Per capita milk consumption in China is rising from a relatively low level. In 2004, per capita consumption of milk products stood at only 18kg, one fifth of the world's average level.

Milk output in China is forecast to rise to more than 50 million tonnes by 2020, doubling per capita consumption of 40kg, according to the Dairy Association of China.

Currently, China's top three dairy giants, Yili Group, Mengniu Group and Bright Dairy and Food Group, control half of China's dairy market.