Food Safety probes online Chinese baby formula trade

A screen grab from Bruce Liu's website, showing how he packages and posts the New Zealand baby formula to Chinese customers.

The New Zealand Food Safety Authority says it will be investigating the online trade in China of Kiwi-made baby formula.

NZFSA senior programme manager Neil McLeod says the organisation "was not aware" the trading was going on until the nzherald.co.nz revealed the ongoing online exporting of milk powder today.

"We were aware that there were large numbers of Chinese people in New Zealand buying [milk] powder to send to friends and relatives in China, but the way your story goes it makes it sound as if it's a commercial deal, rather than a family deal," said McLeod.

Thousands of tins of baby milk powder are being bought from New Zealand supermarket shelves and sold to parents in China through online shopping sites.

McLeod said all food products exported from New Zealand to China required a certificate from the NZFSA, and the authority would be investigating whether New Zealand-based online traders in baby formula were acquiring food safety certificates for their products.

"If it's a commercial venture and they are not getting certification from us, then it's something we'll look at," said McLeod.

He said he was surprised the Chinese authorities were allowing such trading to take place.

The trade is also worrying the local makers of baby formula, who say they have no control over the online exporting of their products to China.

Traders are taking advantage of the fact that - 16 months on from the Sanlu contaminated baby milk scandal - many Chinese parents are still wary of feeding Chinese-made baby formula to children.

Many advertisements for New Zealand-made Karicare baby formula can be found on the Chinese online trading website taobao.com.

Bruce Liu, who runs a warehouse in Manukau, has sold Karicare baby formula by the boxload, since April 2009.

Each of Liu's boxes contains six tins of formula, and are priced between NZ$164 and NZ$284 per box, depending on the type of formula inside.

Liu said he sold one hundred boxes of Karicare baby formula to China each week, netting him $6000 profit each month.

Natasha Bye, medical director for Nutricia - the company that manufactures Karicare products - said she was concerned at the lack of control Nutricia had over this kind of online trading.

She said Nutricia went to great lengths to make sure products reached the market in a safe condition.

"The concern for us is that we have no relationship with this website."

Bye said the company had a separate manufacturing division in China, which manufactured baby formula under a different brand name.

Liu said his lucrative side-business was made more difficult by New Zealand supermarkets that - noticing the activities of traders like him - began restricting the amount of baby formula individual customers can buy at any one time.

"That's the biggest problem of our business because the supermarkets all have really strict policies for us to buy milk powder," said Liu.

He said some supermarkets allowed customers to buy six containers of formula, others only three.

"So eighty per cent of our time is spent going over all the supermarkets [and buying baby formula]."

A spokeswoman for Progressive Enterprises - which owns Foodtown, Woolworths and Countdown supermarkets - said a four can limit, per customer, applied on baby formula at all its supermarkets.

"It's pretty much a response to unfairness that we had with a lot of people stockpiling baby formula and selling it overseas," the spokesperson said.

"We appreciate why people are doing it but our supply [of baby formula] is for the domestic market."

A spokeswoman for Foodstuffs said its "foremost priority" was to ensure local customer demand was met.

"In some instances, to ensure this supply, individual stores have had to self -impose quantity limits based on what is considered a reasonable purchase for a customer," she said.

Liu said he got around this purchase limit by speaking to individual supermarket managers, who sometimes allowed him to buy large hauls of the formula.

He said he preferred to buy his formula from the Countdown and Pak n' Save supermarkets, as their cheaper prices allowed him to make more profit on sales.

Future prospects for the trade were positive, said Liu, as it would be "at least ten years" before Chinese parents again placed enough trust in locally-made formula to give it to their children.