One year ago, a milk scandal occurred in China. It’s reported that Chinese milk powder contaminated with melamine sickened more than 50,000 infants, including 4 deaths. This issued seriously damaged the dairy industry and Chinese consumers lost confidence in native milk products. As a result, the head of major Chinese dairy firm Sanlu Dairy went into bankruptcy; The former chairwoman of Sanlu Dairy was sentenced to life in prison and three others received death sentences. In total, more than 60 people have been arrested in connection to the scandal.
Recently, it seems that the Chinese milk market is recovered. The latest data shows that from January to July, the nationwide diary industry has recovered to 70% of the pre-scandal consumption level. The three giant diary brands–Mengniu Dairy, Yili Dairy and Bright Dairy still rank the top three in Chinese diary market, and the industry structure haven’t changed much, neither.
However, does the melamine totally disappear in China now? The positive results may probably base on two judgments. One is that the enterprises involved in it have paid too much for this; the other one is the government has paid a large amount of compensates and revised some more safety standards.
But what Chinese government did is just an overall control. The truth is the diary industry still faces the shortage of original milk, and the establishment of that is weak. On one hand, the government improves better technology and management so the quality can improve, on the other hand, it just focus on “this issue”, that is, if some other problems occur, we may not have enough preparation for them. In the meantime, if the three giant diary brands’ development only result in government’s effort, that will also be the sorrow of theindustry.