It seems baffling that parents in a country like Australia would have to worry about their baby’s food supply. But this complicated story started nine years ago, with a tragedy of unimaginable proportions.
First published November 22, 2017 at kidspot.com.au
In Australia, we are lucky enough to have many safe and easy ways to feed our babies if we choose not to or are unable to breastfeed our babies.
But many mothers over the past few years, have found that buying formula has become a much more complicated and stressful process than it once was. Formula is regularly out of stock and parents can be left scrambling to find a way to feed their babies.
“I remember when my little one was about six-months-old,” said Sydney mum, Nina Young. “My daughter had a really sensitive stomach, she would get lots of wind and discomfort from most formula brands and the Karicare goat’s milk formula was one of the few she could really tolerate.”
“Breastfeeding didn’t work out for us even though I tried incredibly hard,” she explained. “But I was really happy with that product as an alternative.”
Unfortunately, the goat’s milk formula is one of the products that regularly experiences shortages due to the limited amount of product versus the popularity and demand.
“We got down to half a tin once, and the stock still hadn’t been replaced at our local shops,” Nina said. “We drove around all our surrounding suburbs and nothing.”
Nina and her partner then rang every chemist and supermarket they could find, but not a single tin could be found.
“Eventually we rang Karicare and they had to arrange for it to be sent overnight from out of state to my local chemist,” Nina recalls. “It was insane!”
It seems baffling that we could run out of something so important, but to understand why this stressful situation is happening, you need to learn about a much more stressful situation that Chinese parents found themselves facing a few years ago.
Unimaginable tragedy
In 2008, a handful of Chinese producers cut corners to increase their profit margins and deceive their customers, with horrific consequences.
Melamine, an industrial chemical used in plastic, was added to highly diluted milk to mask their infant formula’s low protein levels during testing to make it appear higher.
This shocking act resulted in the deaths of six babies, the hospitalisation of an estimated 51,000 others and around 300,000 children between the ages of birth and three years suffering serious health problems (such as kidney stones).
In short, it was a tragedy of unimaginable proportions and understandably, it sparked fear and paranoia in the Chinese population.
Breastfeeding rates in Chinese women are lowest in the world. In its 2015 health statistics report WHO revealed an average of just 28 percent of babies in in one of the world’s most populated nations were exclusively breastfed to six months of age.
Chinese families lost complete confidence in their nation’s dairy producers and formula manufacturers. They had no choice but to look beyond their own shores for trusted foreign formula brands that met stringently high standards for the sake of their children’s health.
Big business
Chinese consumers looking for a trusted product soon found their way to the Australian market. Research shows that Chinese consumers view Australian products as clean, natural and safe.
Retailers have been forced to set limits on the number of formula tins customers can purchase in response to the shortage, to curb the success of organised teams of ‘daigou’ (pronounced dye-goo) – meaning ‘Chinese personal shoppers’ – working together to clear their shelves of popular brands such as a2, Bellamy’s Organic and Karicare Aptamil.
Earlier this year, a Sydney mum was furious when she witnessed a large group of people buying up baby formula at Coles in the inner-west. “There would have been easily 20 individuals purely buying formula that night — in that one hour,” she told Kidspot.
While Australian products are highly sought after by the Chinese owing to our country’s clean environment and safe foods reputation, ours is not the only country where retail sales limits have been imposed on consumers in direct response to Chinese demand – Britain, Hong Kong and New Zealand are also affected.
Daigou generally live outside of China and obtain foreign products on behalf of Chinese consumers, which they sell to them at inflated prices. Their main trade was previously luxury goods but an increase in the demand for food items, vitamins and other consumables has risen in consequence of the Chinese public’s concern over local food safety.
Daigou post the formula to China from Australia by regular mail, which requires no special paperwork if the parcel weighs less than 10kg and ensures high import tariffs are avoided.
There’s some serious profits to be gained from supplying the Chinese demand for Aussie formula brands, with reports some daigou are making up to $100,000 a year in profit by on-selling these products to Chinese families at highly inflated prices. Profiteers can resell a 1kg can of formula in China for almost three times the Australian recommended retail price.
In addition, the companies who make Australian-branded formulas are reaping in impressive financial benefits of increased sales and impressive stock prices, ensuring little motivation to tackle the issue of limited stock frustrating their local customers.
Tackling a huge problem
From January 1 2018, International sellers will need to obtain a “product registration certificate” from China’s food and drug administration which may lead to fewer brands selling overseas until they meet the strict new regulations, but won’t do much to curb the illegal market.
Our local retailers are seemingly doing their bit to reduce the inconvenience to local consumers by limiting the number of formula tins customers can purchase at one time but still not meeting overwhelming consumer demand.
Late last month, supermarket juggernaut Woolworths announced they were reducing their formula limit to two tins from four per customer. Woolworths Merchandise Manager, Health, Beauty and Baby, James Hepworth told Kidspot:
“At Woolworths, we understand the frustration that our customers can feel when they can’t get the products they need and this is another example where we’ve taken action to do the right thing. This is particularly the case when it comes to family necessities such as baby formula.
“We know that the vast majority of our customers purchase only the necessary amounts of baby formula required for their family. However, by reducing our can limit to two per shop means we are better placed to support our customers in purchasing this essential item.”
For their part, the major producers of infant formulas here in Australia have remained relatively quiet but for their reports to their shareholders of rising profits and impressive dividends.
Kidspot asked Bellamy’s Organic, an incredibly popular infant formula brand coveted by Chinese as well as Australia consumers, what they’re doing to meet the demand and ensure families in Australia can access their products.
A spokesperson for the company responded with a reassurance that “serving Australian parents is a major priority at Bellamy’s” and that “we’re working closely with major Australian retailers to improve stock availability for parents in Australia”.
Tips to avoid running out
- Keep two in stockpile: Don’t wait until you’re down to your last tin before buying, try to keep two as a spare and restock regularly.
- Phone ahead: Rather than trekking around for hours, call ahead from the comfort of home to find stock.
- Contact the company: Your formula company will know where stock is available and where it’s not, they can even give you a better idea of how long a particular shortage may last. In bad shortages, they may even be able to arrange to have stock sent to a store near you.
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