Help milk farmers, Beijing tells local authorities, firms

PUBLISHED : Tuesday, 23 September, 2008, 12:00am
UPDATED : Tuesday, 23 September, 2008, 12:00am

Beijing has ordered local authorities to help millions of beleaguered milk farmers as many large farms have stopped buying raw milk following the tainted milk crisis.

The authorities fear that if the farmers are forced to slaughter their cows and close their dairy farms, it will trigger a collapse of the mainland dairy industry.

The Ministry of Agriculture has ordered all branches across the mainland to take 'necessary measures to protect dairy farmers' interests', especially in places where wholesalers have stopped buying raw milk.

The ministry said: 'Agricultural departments at all levels should give priority to protect the sales of raw milk and minimise the losses for dairy farmers.'

It urged milk firms to honour purchase contracts with dairy farmers, even though there had been a sharp decline in demand for milk.

The statement came as major milk companies, including market leaders Mengniu and Yili, reportedly refused to take milk in some areas after consumption of various dairy products plunged due to the melamine scare. A nationwide milk quality inspection launched last week was also believed to be part of the reason for milk firms' extra caution about raw milk purchases.

Milk powder adulterated with melamine, a chemical additive, has killed at least four babies and affected more than 52,000 infants across the mainland, with 104 of them in severe condition as of Sunday night, the Ministry of Health said. Babies who drink the tainted milk powder can develop kidney stones.

The scandal escalated last week as further inspection found other milk products, such as fresh milk and ice cream, also contained melamine.

Milk sales have dived over the past week, with people appearing to have been scared off by suspicions of industry-wide malpractice.

The Dahe Daily reported that tonnes of milk had been poured onto farmland at three dairy farms in Zhengzhou , Henan province , as major milk firms stopped buying fresh supplies.

Similar cases have been reported in Hebei and Shandong as well as Inner Mongolia , the hub of the industry.

Many milk collection stations in Hohhot , where Mengniu and Yili are based, were told by phone or text message last week that both companies would not take their milk until further notice.

For Hohhot, a city with close to a million dairy farmers, the news could be devastating to both the economy and social stability.

In its statement, the Agriculture Ministry asked provincial branches and governments to increase subsidies to dairy farmers while urging milk companies to continue buying milk as long as supplies met quality standards.

It was not immediately clear whether the 'subsidies' would mean governments would have to take on the burden of paying for unsold milk.