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Nestle unit cuts baby formula prices amid China probe
by Staff Writers
Shanghai (AFP) July 04, 2013

Adult breast feeding report incenses China web users
Beijing (AFP) July 04, 2013 - Human breast milk has become a new luxury for China's rich, with some firms offering wet nurse services, a report said, provoking outrage and disgust among web users Thursday.

Xinxinyu, a domestic staff agency in the booming city of Shenzhen, which borders Hong Kong, provided wet nurses for newborns, the sick and other adults who pay high prices for the milk's fine nutrition, the Southern Metropolis Daily said.

"Adult (clients) can drink it directly through breastfeeding, or they can always drink it from a breast pump if they feel embarrassed," the report quoted company owner Lin Jun as saying.

Wet nurses serving adults are paid around 16,000 yuan ($2,600) a month -- more than four times the Chinese average -- and those who were "healthy and good looking" could earn even more, the report said.

Traditional beliefs in some parts of China hold that human breast milk has the best and most easily digestible nutrition for people who are ill.

But the report sparked heated debate in the media and on Chinese social media, with most users condemning the service as unethical.

"This adds to China's problem of treating women as consumer goods and the moral degradation of China's rich," said Cao Baoyin, a writer and regular commentator in various Chinese media, on his blog.

Xinxinyu has been ordered to suspend its operations and had its business licence revoked for multiple reasons including missing three years of annual checks, regulators in Shenzhen told AFP on Thursday, although the wet nurse service was not among the factors they cited.

Company officials could not be reached for comment by AFP.

There were nearly 140,000 postings on Sina Weibo, a Chinese equivalent of Twitter, on the topic by Thursday afternoon.

In an online poll, almost 90 percent of participants voted against the service, saying it "violated ethical values", a fraction over 10 percent deemed it a "normal business practice".

"People become perverts when they are too rich and tired of other forms of entertainment. This is disguised pornography," said a user with the online handle ricky_gao.

White Lotus, another weibo writer, said: "Please do not force motherhood to lose its grace and become ridiculous."

Other postings voiced cynical approval.

"It's just a business, nothing to blame it for," said A Xiao Shuai. "People are insensitive about ethics when there is money on the table."

Among the general population in China breastfeeding rates are low -- just 28 percent according to a 2012 UNICEF report -- due to time limits on maternity leave and aggressive marketing of formula.

A unit of Swiss food giant Nestle is cutting prices for baby formula in China by as much as 20 percent, it said after the government launched a investigation into alleged price-fixing by foreign firms.

Wyeth Nutrition confirmed the investigation by China's top economic planner, which has been reported by state media, and pledged to "immediately" cut prices on some formula products by six to 20 percent, according to a statement late Wednesday.

"Wyeth Nutrition has always respected and been willing to abide by China's laws and regulations and is actively cooperating with the anti-monopoly investigation into the company," it said.

The firm promised not to raise prices on new formula products for a year and said it had improved marketing policies to ensure they were in line with regulations.

The response came after media reports on Tuesday that the National Development Reform Commission had launched a probe of foreign baby formula makers for high prices, which it claimed resulted from a monopoly-like situation.

But a 2008 scandal involving tainted formula that killed six children and sickened more than 300,000 has prompted domestic consumers to shun local brands and created huge demand for foreign products, both those sold through normal channels and informally imported.

Other foreign companies being investigated include France's Danone, Mead Johnson Nutrition, Abbott Laboratories and Dutch firm Royal FrieslandCampina which produces the Friso brand, state media said.

Mead Johnson said earlier this week it was cooperating with the investigation and added it was providing products at "good value" to customers.

"The company is fully cooperating with the recently reported Chinese government anti-trust review of resale prices in the infant formula market and will provide information in response to enquiries received from government officials," it said.

Shares of some of the companies involved in the investigation, which has not been directly confirmed by the government, plunged in US trading on Wednesday.

Mead Johnson sank 8.1 percent while Abbott Laboratories fell 1.8 percent.

But shares of Chinese dairy producers have benefited since the investigation has targeted foreign companies.

China Mengniu Dairy gained 1.98 percent in Hong Kong morning trade Thursday while Inner Mongolia Yili Industrial Group rose 0.73 percent in Shanghai.

China is by far the world's largest market for baby formula, according to consumer research group Euromonitor.

The government has vowed to crack down on safety violators and called for strict monitoring of milk powder production, in an attempt to restore public trust.


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