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LCQ15: Infant formula supply

     Following is a question by the Hon Frederick Fung and a written reply by the Secretary for Food and Health, Dr York Chow, in the Legislative Council today (April 6):


     It has been reported that the incident of radiation leak in Japan has sent consumers scrambling for infant formulas in Hong Kong recently, thus further tightening the supply.  Some members of the public criticised that some shops had increased the price excessively, and some even bundled the sale of infant formulas with other goods. As revealed by the CHOICE magazine published by the Consumer Council (CC) in March 2011, of the 33 items of the major brands of infant formulas surveyed, 24 had had their average retail prices increased from 4% to 12% (comparing the prices for April 2009 to February 2010 with those for the same period from 2010 to 2011), registering an increase in price higher than the food price inflation rate (3.6%) for the corresponding period. The survey also shows that the out-of-stock rate of infant formulas of some popular brands was as high as 64%, and it is believed that the scrambling for these products by non-local people is one of the causes of the heightened out-of-stock rate. In this connection, will the Government inform this Council:

(a) whether the authorities have looked into the reasons why the increase in retail prices of infant formulas is much higher than the food price inflation rate; and whether there is stockpiling and hoarding for speculation; given that CC has urged formula suppliers to consider setting up an industry code of practice to ensure adequate supply to local consumers, will the Government consider facilitating the trade in drawing up a code of practice, including ensuring adequate supply to local consumers and adopting the means of suspending supply to retail shops which raise the price of infant formulas unreasonably;

(b) given the recent situation of intense scrambling for infant formulas, of the authorities' concrete measures to ensure adequate supply and stablise the prices of infant formulas, so as to avoid speculative surge of prices; and what measures are in place to ensure that the grassroots need not bear huge expenses on infant formulas; and

(c) whether the authorities will grasp this opportunity to promote the benefits of breastfeeding to the public and step up public education, so as to eliminate the misconception of the public that infant formulas are richer and more comprehensive in nutrient components than breastmilk, and to address parents' concern that switching to other brands of infant formulas may affect the health of their babies, so that they will consider choosing other brands with relatively stable supply, and to change the current situation of the blind worship of famous brands by parents; if they will, of the specific details; if not, the reasons for that?



     The Government cares about babies' health and has been promoting the merits of breastfeeding in order to encourage its adoption by parents. The Government also understands that some parents still prefer infant formula, and has therefore paid particular attention to their safety and supply. Since the reports of shortage of infant formula, we have been proactive in liaising closely with major infant formula suppliers, the Hong Kong General Chamber of Pharmacy and major retailers. We were assured by the suppliers that they had sufficient stock on hand, and that they would increase supply to cope with the growing market demand.

     After the nuclear radiation leak triggered by earthquake and tsunami in Japan, we noted that the supply of certain brands of Japanese infant formula might be reduced as a result.  Japanese brands accounted for about one-fourth of the supply in the local market in the past year, and shortage of some brands might have direct impact on those babies consuming these products. Meanwhile, suppliers of other infant formula brands have indicated that they had adequate stock to meet the demand if parents chose to switch to their brands. As the nuclear radiation leak may have a prolonged impact, the supply of Japanese infant formula to Hong Kong will inevitably be unstable. In these circumstances, the Government asks parents to consider switching to other brands of infant formula for their babies when necessary. As the ingredients of different brands of infant formula are generally the same, switching brands for babies should not pose problems provided that due care is exercised during the transition period.

     The reply to the three parts of the question is as follows:

(a) and (b) Since the earthquake and the incident of nuclear radiation leak in Japan, we have been proactive in liaising closely with major suppliers, importers and retailers to keep in view the supply and market situation of Japanese infant formula, and to understand the impact of the earthquake and nuclear incident in Japan on the supply of infant formula in Hong Kong. At the meeting chaired by the Permanent Secretary for Food and Health (Food) on March 22, 2011, major suppliers, importers and retailers of food and infant formula indicated that the supply of Japanese infant formula could not meet the recent surge in demand. Importers have already requested the suppliers in Japan to increase their exports. There were indeed uncertainties as to the quantity of supply in the near future since some Japanese manufacturers had advised the local trade that the exports to Hong Kong might be reduced in order to meet domestic need in Japan. Nonetheless, the trade will step up liaison with the Japanese suppliers with a view to minimising the impact on Hong Kong as far as possible.

     As the public expected that the nuclear incident would have a prolonged impact on the supply of Japanese infant formula, many of them scrambled to purchase those products manufactured before the earthquake, generating a sudden upsurge of demand. Given the dynamics of supply and demand, prices at some retail outlets soared. This was due to a short-term imbalance in demand and supply and the suppliers' commercial considerations.

     As regards infant formula imported from other countries, their supply will not be affected by the earthquake and nuclear incident in Japan since their raw materials come mainly from Europe, Australia and New Zealand. Representatives of the trade have also indicated that supply of these infant formulas was abundant. They are prepared to provide guidance to parents who wish to switch from Japanese brands to other brands. The major brands have already set up hotlines or purchase and delivery services.

     During their communication with the Government, the representatives of the major infant formula suppliers have all agreed that meeting the needs of local babies was their prime responsibility, and they had been closely monitoring the market situation. If necessary, arrangements would be made for increasing supply in Hong Kong to ensure a stable supply of infant formula in the local market.
     Hong Kong practises free trade, and the best way to maintain a reasonable price for infant formula is to ensure a stable and sufficient supply. In addition, the Consumer Council also releases information of major brands of infant formula through the CHOICE Magazine and its website, including the out-of-stock rate, prices, customer services information and hints for switching formula for babies, etc. Such information will increase the market transparency and competition.

     The Administration will continue to keep close liaison with the major suppliers, importers and retailers of infant formula and take corresponding actions to jointly ensure their stable supply in the local market.

(c) The World Health Organization (WHO) recommends breastfeeding as the way of providing the best food for healthy growth and development of infants. It recommends that babies under six months of age should preferably be exclusively breastfed, and then continue to be breastfed along with supplementary foods up to two years of age or beyond. The Government has all along endeavoured to promote, protect and support breastfeeding and to implement this policy through the Department of Health (DH) and the Hospital Authority. Healthcare professionals provide counselling service for breastfeeding mothers, and help post-natal women acquire breastfeeding skills and tackle the problems they may encounter during breastfeeding. Maternal and Child Centres under DH also conduct workshops to equip breastfeeding working mothers with the necessary skills so that they are prepared for continuing breastfeeding after returning to work. To enhance parents' understanding on diet for babies and infants, DH plans to produce a parenting education kit on healthy diet for babies and infants, which will include a handbook, education VCDs and recipes, etc. so as to disseminate positive health information among parents.

     Besides, the Government is now in the process of drafting a Hong Kong Code of Marketing of Breast-milk Substitutes (the Hong Kong Code). The Hong Kong Code aims to regulate the manufacturers and distributors of breast-milk substitutes and to prohibit them from advertising and marketing their breast-milk substitutes and related products by way of malpractice. In developing the Hong Kong Code, the Government will take into account the details and scope of regulation recommended in the WHO Code. When the Hong Kong Code comes into effect, we will monitor its implementation to ensure that the correct information reaches the parents.

Ends/Wednesday, April 6, 2011
Issued at HKT 15:16


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