I know this is a topic of little interest to most Americans (at least until it starts showing up in our food supply), but it's one that I follow quite closely as a China wonk.
54,000 sick children now. And it's gone beyond milk. Now affected are snack foods, baby cereal and candies, a number of them made by multinational corporations based outside of China such as Heinz and Japan's Marudai. The fact that the MNCs are getting caught up in this now is good for two reasons:
- It shows that the problem is at the very basic level: raw resource collection and production. The melamine is getting into the supply at the lowest rungs of the system, either on dairy farms or in the local dairy collection points. I'm even wondering if possibly it's coming from high levels of melamine in the fodder, but I don't really know enough about melamine to know if it would pass into the milk that way or not.
- It drags some heavy guns into the fight. Strange as it may sound, when it was just the Chinese government trying to fix this, they didn't have enough leverage against the Chinese dairy industry which like most industries in China, is so fragmented and decentralized that it's almost impossible to effectively regulate. But now with MNCs with deep pockets and a distinct aversion to PR nightmares like this, there's leverage. Heinz can tell its dairy suppliers, "Look, we're going to require that you test for melamine at X stages of the process, or else we don't do business." And there's enough competition in the market that that's a real threat. Granted, there will be some companies (mostly indigenous mainland ones) that will still deal with non-compliant dairies just to squeak out a better margin. But then over time, that should confine safety issues to a handful of brands, which the public will likely shun in favor of "safe" major brands. Not that different from the way brand recognition works everywhere else. You pay a little more, because you trust the product more.
It's a damn shame that so many have had to suffer for the greed of (some) unscrupulous producers. But in the end, this should be a learning experience for Chinese capitalism, not dissimilar to the sort of things we went through in the early 20th century with slaughterhouses and food safety. CCP regulation will be one step, but the free market will be the real power here, rewarding manufacturers that ensure safety and penalizing those who take risks.