food safety scares, China retailer offers baby milk insurance
Send a link to a friend
[August 22, 2014]
By Clare Baldwin and Diana Chan
HONG KONG (Reuters) - A Chinese retailer is
offering insurance to customers who buy infant milk powder, highlighting
the lengths to which companies are going to address concern about food
safety in China.
Suning Commerce Group Ltd, which owns the Redbaby chain of stores,
told Reuters it had launched the policy this week, backed by China's
second largest insurer Ping An Insurance Group.
The policy stipulates that if a brand of milk powder is recalled,
customers who bought cans from any Redbaby store or its e-commerce
website would be paid up to 2,000 yuan ($325) per can, with payments
capped at 100,000 yuan.
"In recent years, the milk powder market in China has been in a
mess," Suning said in an email.
"We realized that parents pay a great deal of attention to their
children's health and safety, and in particular, the safety of their
infants' foods," it added. Insurer Ping An said Suning's policy is
the first of its kind in China.
Concern about the safety of baby milk powder came to the fore in
2008 when thousands of infants fell sick and six died after an
industrial chemical was added to raise the apparent protein content
of certain products.
Pharmacies in Hong Kong, where food safety regulations are perceived
to be more stringent, saw a run on infant milk formula following the
scandal and many Chinese people still travel into the city, a
special administrative region of China, to buy it.
Regaining trust in China could be worth a lot. The market is
expected to reach $17.8 billion this year, according to Euromonitor.
Suning said it was giving the insurance away for free for the first
40,000 cans of baby formula sold. After that, customers can buy the
According to its e-commerce site, Redbaby stocks milk formula from
multinationals including Mead Johnson Nutrition, Nestle SA, Danone
SA as well as brands made by China's New Hope Nutritional Foods Co
in partnership with New Zealand's Synlait Milk Ltd.
[to top of second column]
Along with detailed nutritional information, the website also
highlights the expiry date of each can of formula.
Food safety remains a major concern in China. This week, U.S.
foodmaker H.J. Heinz Co was forced to recall some of its infant food
products because they were found to contain excess levels of lead.
KFC parent Yum Brands Inc, McDonald's Corp, Wal-Mart Stores Inc and
Fonterra Co-operative Group Ltd have also recently faced food safety
(Additional reporting by Donny Kwok in HONG KONG and Adam Jourdan in
SHANGHAI; Editing by Miral Fahmy and Robert Birsel)
[© 2014 Thomson Reuters. All rights
Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.