Online stocks of infant milk powder under pressure

Online shopping sites say they are finding it hard to keep up with demand for canned infant milk powder, after measures came into force at the start of the month to restrict people carrying the product from Hong Kong to the Chinese mainland.

From March 1, individuals arriving from Hong Kong were allowed to carry just two cans of infant formula. Hong Kong has already banned anyone there from buying 1.8 kilos of the product to crack down on cross-border trading and prevent stores from running out of stock. Violators face a fine of HK$500,000 ($64,500) and up to two years in jail.

Similar two-can purchase restrictions have also been announced by the Netherlands and New Zealand for milk powder there.

The surge in demand for powder from outside the mainland can be traced back to 2008, when melamine-tainted formula caused the deaths of at least six Chinese infants and left 300,000 others sick, which forced many parents to choose imported products for their newborns.

Imported formula has now become so sought-after because food safety worries continue, and many Chinese consumers have been forced to try to buy such formula online.

According to figures released on Thursday by Taobao.com — considered China's most popular retail platform — sales volume of imported milk formula in the past seven days was nearly 12 times that of the same period last year and had increased 13.4 percent compared to the week before.

In order to have enough stock to meet the growing demand, most of the online shops selling milk formula in Taobao posted notices telling customers that the prices were likely to fluctuate due to the limited supply of imported product.

"We allow customers to buy up to only four cans, as the original supply chain has been severely affected by the restrictions, and nearly 20 types of formula are now out of stock in our store," said Zeng Kuixing, a Taobao store owner who sells Hong Kong imported food, including infant formula.

Zeng said that it would now take much longer to restock with product from Hong Kong. In addition, online shops selling milk formula imported from countries like the Netherlands, Germany and New Zealand reported they too were busy dealing with a rapid growth in orders from customers.

Xi Xi is a Taobao shop owner selling products imported from the Netherlands, including infant milk formula under the well-known Nutrilion and Friso brands.

She said: "Preparing enough stock has been getting more difficult since 2013 as one person is only allowed to buy two cans of formula at a time in supermarkets in the Netherlands, which has forced me to travel around the city to get more cans and send them to China more frequently."

Xi added that she has had to increase the price of milk formula by about 15 yuan ($2.41) since the middle of February, and has spent considerably more time than usual trying to keep up with rising customer demand.

Tmall, another major Chinese online shopping platform, made a formal announcement on March 1 that it would be cooperating with overseas baby formula companies to sell their products to Chinese consumers online.

"Tmall will open an official online store for six baby formula brands, which will enable domestic buyers to purchase imported milk products directly," said Zhang Yong, the president of Tmall.

Zhang added the products would be imported directly from those countries, sent through China Customs and delivered to customers via express mail.

The six brands are Karicare, Nutrilon, Cow&Gate, Dumex, Nestle NAN HA and Wyeth.

Qiu Yizhong, a senior manager at Yihaodian, another leading consumer website also selling imported milk formula, reported it had seen a 50 percent weekly rise in the sale of milk powder.

"We plan to introduce more overseas brands of infant milk formula, making up to 100 different brands available online by the end of the year."

Hu Xiao, the mother of a two-year-old daughter, who has been buying three cans of milk formula imported from New Zealand per month, said she welcomed the news that both Tmall and Yihaodian were introducing measures to help improve supply.

"I am still not confident about the quality of dairy products in China. "