China Food Scandals
A crisis in confidence in China's food industry emerged after melamine was found in domestically produced baby formula in 2008. The scandal sickened 300,000 babies and resulted in six premature deaths. Other stories of fake eggs, diseased pork, recycled oil, mislabelled meat and more have only led to more calls for industry reform.
Hong Kong food inspection firms urged to profit from mainland China food scares
Private food inspection business set to expand as concerns grow over mainland foodstuffs
Food scares please nobody, but safety concerns about foodstuffs from the mainland could prove to be a lucrative business opportunity for Hong Kong inspection companies.
The US rejected 23 per cent more shipments of food and cosmetic products from mainland China in the first six months of this year than it did in the same period in 2012.
According to the US Food and Drug Administration, that meant 2,488 shipping containers were turned back at US ports, up from 2,015 last year.
Among the rejected products were salmonella-infected frozen rabbits, unclean flounder fillets and melamine-laced custard buns. Most of the products did not come with any proof of laboratory analysis.
Now, a study by the Bauhinia Foundation Research Centre has recommended that Hong Kong inspection firms tap the food safety market, which it says has considerable growth potential.
"Hong Kong's testing and certification industry has a trustworthy reputation as well as rich expertise to support local importers," the report said.
There are signs that the industry is growing, but perhaps not fast enough to exploit the market's full potential.
As of February, there were 198 accredited laboratories, 19 accredited certification bodies and 20 accredited inspection bodies in the city.
China Dragon Inspection & Certification, which provides testing and labelling services for Hong Kong food exporters, is one of the local companies that has seen its business expand on the back of the mainland's increasingly spotty food safety record.
Ringo Lee, its sales and marketing manager, said: "In the past year, we had revenue growth of approximately 3 per cent due to recent food scandals in China."
Hong Kong imported 94 per cent of its fresh pork and 92 per cent of its vegetables from the mainland in 2010.
The global food testing, inspection and certification market was worth €82.2 billion (HK$830 billion) in 2010.
It is forecast to grow at an annual rate of more than 5 per cent in the next two years, reaching a value of €98 billion.
Demand for testing from countries such as China and India is also only likely to escalate, especially as health and safety laws are tightened.
Mainland Chinese officials have already imposed harsher penalties for retailers who produce or sell unsafe food, and more than 900 people involved in fake meat scandals were arrested last month, according to the public security ministry.