New laws in China have ‘significant implications’ for infant formula suppliers

The Chinese Government recently issued its new ruling concerning the supply of infant formula by domestic and foreign companies to China.

According to James O’Donnell, Shanghai Office Manager for Bord Bia the revised procedures have significant implications for suppliers.

He says the new regulations are due to come into effect on October 1, however, a “grace period” is expected.

The principal objective of this regulation has been to reduce the number of products on offer and strengthen the regulatory authority’s ability to supervise and insure consumer confidence.

According to O’Donnell China alone has over 100 licenced Infant Formula manufacturers who produce over 2000 different products not to mention the range of imported product available in the market.

Key points:

  • Both domestic and foreign companies are now restricted to 3 product lines with a maximum of 3 stages per line. This will restrict major players on the range of their offering and limit line extensions.
  • All enterprises supplying the market both domestic and overseas must be pre approved by the CNCA. This measure is expected to rein back the explosion of product available for purchase on cross border online platforms.
  • Recipes must be pre-registered with and approved by the CFDA. Each recipe needs to be distinctly different to warrant approval.
  • Labelling requirements have been tightened. Such general terms as “sourced for imported milk/ milk powder” are no longer allowable. The country of origin must now be stated. The requirement here will have significant impact on the supply chain tying companies into sourcing milk / milk powders from specific countries.

Infant formula and dairy ingredients destined for the sector in China are Irelands largest food and drink export items to China.