It’s been 2 months since the draft of “Administrative Measures for Registration of Infant Formula Formulations” was issued by CFDA (see CL Food News on 2 Sep 2015).
Under the pending regulation, an IF product must be designed for sale on a national scale meaning companies should not restrict the sales area or customize products for traders in specific areas. Additionally a “one formula, one brand rule” will be practically implemented. Registration of an IF formulations requires clear differences in ingredients compared with products already circulated on the market and use of ingredients must be supported by scientific evidence. There are two options for companies to choose: the first option is that formulas for the same infant formula stage (1,2 or 3) should have significant differences (at least 6 optional ingredients listed in the national food safety standards (GB 10765 & GB 10767) must be different); the second option is more direct by restricting the number of formulas and brands owned by one company which will be limited to producing a maximum of "5 distinct brands, 15 formulations". (Under Chinese regulatory requirements, each brand has 3 distinct stages meaning a total of 15 formulations will be permitted)
At present there are approximately 2000 brands on the Chinese market, however when the regulation is promulgated this number will be largely reduced as a large percentage of these brands are customized for regional sale and show little if any variation in formulation compared with other brands. IF Traders have started a clearance sale of IF products that will not pass the pending registration requirements.
Although this Measure has not yet impacted imported infant formula, some imported products have also had prices slashed due to approaching expiration, poor sales performance or termination of OEM cooperation with their overseas manufacturers. China CFDA and AQSIQ is still disusing with each other about implementing a formula registration rule for IF brands exported to China as well (see CL Food news on 22 Sep 2015) but no further progress has been heard by the government recently.
China’s Alibaba “11.11” shopping festival which is also the world largest one-day e-sale is sure to be a great chance to clear IF stock. Online IF traders are busy preparing for the mega sale day and will offer very favorable prices starting from just 45 RMB a can.
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