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Source: ONE News -
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Dairy farmers in the home province of Fonterra's ill-fated Chinese joint venture, are getting over the melamine contamination scandal and are now bracing themselves for a market boom, said an industry chairman in northern Hebei Province on Monday.
"Most farmers are keen to expand their business scale, which was in sharp contrast to the post-scandal phenomenon of dumping milk," Wang Yinsheng, chairman of the Hebei Food Industry Association, told the China Daily.
"The market has recovered to 70% of the pre-scandal consumption level, and we expect it recover to 90 percent by the end of this year," said Song Kungang, director-general of the China Dairy Industry Association.
Sanlu Group, which was based in Shijiazhuang, had been China's leading seller of milk powder for 15 years until the melamine scandal broke last September. The company's tainted baby milk powder was found to have caused the deaths of at least six children and sickened more than 300,000 others.
At least 22 companies were found to be selling contaminated milk, but the highest levels of melamine were found in Sanlu milk.
Fonterra's 10,000 farmers wrote off over $200 million of investment in the joint venture, but the co-operative received higher orders for its milkpowders imported from New Zealand in the wake of consumer concerns over quality assurance in Chinese milk.
Xiao Luozhen, a 60-year-old dairy farmer in Hebei, said "the worst time has passed", although the Chinese dairy farmers are still "running businesses at losses".
"The raw milk was collected at 1.6 yuan (about NZ36c) a kilogram December last year, which is much cheaper than a bottle of 500ml mineral water. The price has bounced back to 2.6 yuan per kg now," said Xiao, who has a cow-breeding farm in Xingtang County, the largest cow-breeding base in north China.
The farmer said he had hopes of an industry boom, and had doubled the number of cows in his herd to 600.
"I am applying for a bank loan in hope to add another 200 cows. I should get prepared as the market is getting hot sooner or later," said the veteran dairy farmer.
He named his twin grandsons, born in October last year during the scandal, "Nan Jiao" and "Dao Guan", meaning "hard to sell milk" and "dumping milk," so the family would remember the difficult period when he found no buyers for his raw milk.
The county government has provided dairy farmers with 40 million yuan in subsidies and low-interest loans worth 60 million yuan, to help them cope with the sluggish market, excess raw milk in stock and low purchasing prices.
"Farmers began to dump raw milk and abandon cows after the incident," said Lu Shuping, deputy head of the county animal husbandry department. "The county government acted swiftly to help build 109 cow-breeding bases to raise the cows and collect milk from the farmers".
The county now has about 75,000 cows in stock, accounting for one third of the total in Shijiazhuang.
Nationwide, in response to the melamine crisis, the Ministry of Agriculture found 3908 of the country's total 20,393 milk collection stations defective, and shut them down.
