CCM: Strictest Ever Policies Point to Full Supply Chain Control 05-10-2016

On 7 January, CFDA released the Regulations on Record of Food Safety Traceable Information of Infant Formula Production Enterprises. The policies targeted at product safety will push companies to build vertically integrated operations where possible.


Product safety is clearly critical to the development of the infant formula industry. In a move designed to build up consumers’ confidence and ensure whole-process traceability of infant formula production, the China Food and Drug Administration (CFDA) released the Regulations on Record of Food Safety Traceable Information of Infant Formula Production Enterprises (Regulations) on 7 January.


Under its terms infant formula manufacturers are required to provide full production information, and establish and improve their food safety traceability systems, whilst their responsibilities are highlighted.


The Regulations make it clear that infant formula producers must code the batch number uniquely based on production date, and file the codes as production records and as a basis for their food safety traceability system, retaining these records for at least 3 years.

Manufacturers are required to accurately record the personnel in charge of production planning and direction and key indices such as production quantity, the plant’s environmental records (temperature, humidity, etc.), cleaning/hygiene maintenance records, raw materials, operating times/operators etc. to ensure the traceability through every stage of the process.


Regarding sales records,the Regulations require that sales through online stores must be recorded alongside those through traditional retail channels.


Trade sources view the traceability systems positively:

Consumers can directly check on the regulated production process, which should help build confidence in domestic products

Problems and those responsible can be identified in the event of any food safety accidents

Manufacturers will be compelled to regulate their production, bringing quality improvement as a result


The Food Safety Law and the General Standard for the Labelling of Prepackaged Foods for Special Dietary Uses implemented in 2015; and the Regulations on the Administration of Formula Registration for Infant Formula which is likely to be issued this year, along with the Regulations, are being referred to as the “strictest ever policies” by domestic media. Certainly they were already impacting the industry in H2 2015, even though some had not yet been issued.


Some dairy companies, in order to deal with the regulation on labelling, lowered their prices on the products with outdated labelling. (Note: the new rules required packs of imported infant formula to be labelled in Chinese, without which they would be returned or destroyed, whilst for domestic products, Stage 1 formula labels were no longer permitted to highlight typical and widely used ingredients – for example, DHA or whey protein – and make a feature of how high their content is, or mislead consumers by claiming curative capabilities for a product.)

“In the situation where enterprises are busy adjusting product categories and running down their inventories, the whole infant formula industry is seeing declines in profit. However, sales promotion is not a long-term strategy”, said industry commentator Wang Dingmian.


In particular, full control of the supply chain is increasingly the target of the leading local formula producers.


Bright Dairy and Feihe Dairy respond to “the strictest ever policies”

On 29 December, 2015, Bright Dairy and Food Co., Ltd. (Bright Dairy) released the first Food Safety White Paper in China, indicating that this was a direct response to the new Food Safety Law. It summarised the measures it has taken already:


In recent years, it has been shutting down minor and dispersed dairy plants and investing in large-scale dairy farms. Now it claims its milk is 100% sourced from “largescale, quality and healthy” dairy farms.


It has drawn up lists of 32 key measures for supervising and controlling 55 specific risks in its dairy farms. By the end of 2015, it owned 35 largescale dairy farms (according to the Ministry of Agriculture, >300 cows), with a total of 80,000 cows.


It recognises 79 points of risk during the whole production process. Additionally it has invested strongly in technology: production is carried out in fully enclosed pipelines, with all products checked/monitored at between 808 and 1,581 separate points in the production line


Zhang Chongjian, President of Bright Dairy said: “Under the new circumstances, an integrated supply chain is the key to ensuring the quality of dairy products. Now we are basing our core competitiveness on our safety control system”.


Heilongjiang Feihe Dairy Co., Ltd. takes a similar stance, in line with its traditional business proposition: “There are 2 critical links: one is the upstream production, the other is the marketing. Producing our own milk is vital”. Feihe Dairy believes it has now achieved whole process traceability and control, from forage grass planting, largescale dairy farming, production and processing, logistics and storage through to channel supervision and control and even to after-sale service.

This article comes from Dairy Products China News 1601, CCM

About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.


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Tag: Infant Formula  dairy

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