Food. The Reason Some Are Looking to Leave China

Wednesday, May 9, 2012 7:37

Speak to anyone who had a child while they were in China, and one of the first issues that comes up is food safety. Beyond air pollution, there is no topic that (in general) I have more discussions about… and more often than not I am being asked what I eat and where do I get it from.

It has become such a concern that many (I speak with) are considering leaving China, and the recent Xinhua aritcle detailing the fact that cabbage in China is laced with formaldehyde is certainly not going to help matters one bit.

Zhao says he uses the chemical to keep the cabbage in good condition during a 10-hour journey to Langfang, a small city on the Hebei-Beijing border. “Vegetable dealers in Langfang openly demand formaldehyde-preserved cabbages because they sell more easily.”

He also says the practice is not a new one. “I just did what everyone else was doing for three or four years. Vegetable dealers in other parts of Shandong and Hebei do the same.”

A practice which is technically not illegal!

It is still unclear how the toxin-using dealers should be penalized, as no such conditions exist in relevant laws and regulations, said Liu.

China’s law on farm produce safety stipulates that the use of preservatives should “conform to relevant technical standards of the state,” but fails to define what preservatives, or how much, are acceptable.

Now, I am not sure how the application of formaldehyde will impact the consumer, whether or not it can be washed off or if one just needs to peel the top layer off (I have an email into someone who knows), but let’s be clear about something… this is not the worst of it, nor is it the only problem.

What is the problem? In my mind there are two primary factors that go beyond stupidity, greed, and outright evil.

The first is that the policy level, primarily at the NRDC where pricing of commodities (including food crops) is what gives them power. Like their ability to set energy pricing, the NRDC has the ability to pervert the natural laws of the market and force everyone in the chain to cut corners. That, in setting a price that protects the consumer from inflation, the policy will almost always result in cutting corners. Match that to the second big policy problem that exists, which is a blind campaign to promote security of or consumption of a good (like milk) where the conditions on the ground simply are not aligned. Farmers are forced to game the system through various chemicals, food quality standards are reduced, and once again the consumers are at risk.

Second to that in terms of important is the supply chain of food in China, and more specifically the fragmented nature of agriculture in China. the average farmer (legally) tends just over a MU of land. 660 square meters. Or what some in the states would consider their hobby plot. And with such a small parcel of land available to them, managing quality is absolutely impossible. They are unable to afford high quality inputs, their farm is not large enough for equipment, to max out their yields pesticides/ NPK/ herbicides are thrown on at 3x the rate needed. Match that to a supply chain that is equally fragmented, and is really a matter of consolidation, and what you have is a massive amount of adultery and waste in the system. A system which eventually finds exits in wet markets (small sellers), local grocery stores, and depending on the channel the large chain stores. high quality sources have historically been exported to the likes of Whole foods, but that is a separate post.

Which leads to the “how”.

How is it that goods laced with formaldehyde are making it to market? Simple, they have to. Keeping in mind the fact that China is fighting massive inflation right now, and that there are probably fewer industries for room to “look away”, the good make their way through consolidators, distribution channels, and testing centers without anyone raising a flag. It is in part because there is no third party system in China, and it is in part also due to the face that the media know something for three years without saying anything, but the net result is that people are getting sick. 300,000 children getting kidney stones. Shanghai’s stomach cancer rates shooting off the charts.

which leads me to the “what do I do”

simple. I find trusted sources. I spend time speaking with experts, visiting farms, and following supply chains to see who has the best quality (safest) products I can purchase for myself (and my family). Greenpeace’s new iPhone app helps with this, but also knowing who 5 star restaurants and hotels are buying from helps.

Which is where is starts, and why I am seeing massive spending by the local Chinese as they look for USDA Organic labels for baby food, are ordering vegetables from Shanghai/ Beijing’s largest organic farms, and are importing baby creams, powders, and clothing by the suitcase. An industry that, as I mentioned in my previous post, is booming.

But, for some (Chinese and expat alike), that isn’t enough, and over the next 2-3 years I expect to see people I know move to safer ground because we all know that even with the reporting, the fact is that operationally this problem is going to require more than installing some equipment and issuing uniforms to unemployed students.

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4 Responses to “Food. The Reason Some Are Looking to Leave China”

  1. lark says:

    May 12th, 2012 at 12:52 pm

    Isn’t this an aspect of the lack of a quality legal system? Regulation of food production requires that agencies cannot be bought off or gamed. They need real enforcement powers.

  2. Rich says:

    May 15th, 2012 at 11:01 pm

    Lark

    Yes, and I see the need for third parties as well.

    Right now, China is facing a dearth in those who can effectively test (much less enforce), which is where I still point back to the supply chain system itself. Processors and retailers need to be apart of this process as well

    R

  3. Joe Z says:

    May 18th, 2012 at 9:18 pm

    Great post on food safety recently.

    It is worth noting that when we were in SH my daughter would throw up at least twice a week after eating. My wife ALWAYS attributed it to daughter ‘making her stomach upset’ by moving, and would insist she sit still. See how well that strategy works with your 2-year old.

    Anyway…

    Since moving back to the States my daughter has thrown up exactly twice in 5 months: once in the first week and once last night, because she is sick with genuine flu and has fever.

    I am convinced the food over there is more poisonous than anyone knows.

  4. Randy says:

    June 21st, 2012 at 3:49 am

    Rich – Thank you for the post, I wish that I had read this sooner. I agree with Joe Z. that food safety in China is a huge problem and may actually be getting worse due to monetary pressures. 1. Pollution, 2. Food Safety – After 12 years in China and a 3.5 year old, adios in two weeks.

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