Unscrupulous companies make substandard milk abroad to trick Vietnamese families who don't trust local products
Dang Minh Sang, deputy director of Manh Cam Company, displays the label of a can of Danlait, a goat milk product, of which it is the sole distributor in Vietnam. Allegations have arisen that several foreign brands of formula in Vietnam are in fact local companies that produce low-quality products abroad for cheap and sell them here for a premium. Last month it came to light that Manh Cam Company had been producing cheap supplemental baby formula abroad and selling it here at high prices and marketed as full-on formula powder when in fact the product did not meet any Vietnamese, or foreign, standards for formula.
Two-month-old Nguyen Gia Bao was bottle-fed from the very beginning. His mother Viet Nga is determined to feed her baby boy imported formula, even if she has to pay more. Such is the accepted social norm nowadays in Vietnam.
Figures from the General Department of Vietnam Customs show that the country's total value of dairy imports reached US$840,736,015 last year, despite the economic downturn. Infant milk formula is still the market's best performer.
But allegations have arisen that several foreign brands of formula in Vietnam are in fact local companies that produce low-quality products abroad for cheap and sell them here for a premium.
Last month it came to light that Manh Cam Company, the Vietnamese distributor of goat-milk powder Danlait, had been producing cheap supplemental baby formula abroad and selling it here at high prices and marketed as full-on formula powder, ie a replacement for mothers' milk, when in fact the product did not meet any Vietnamese, or foreign, standards for formula.
Danlait is imported in full cans from France and advertised in Vietnam under the brand name F.I.T, which Manh Cam promoted by alleging it is "one of the leading goat milk producers in the EU."
But in mid February, young Hanoi mother Cao Ngan Ha posted suspicions on online parenting forums that Danlait baby formula was not all it claimed to be.
After using seven cans of Danlait goat-milk powder, Ha's six-month-old baby started losing weight, experienced slow-teething and was eventually hospitalized for weeks with malnutrition, weight-loss and fever. Consulting friends living in France, the panicked mother found that her relatives had never heard of Danlait milk. Other mothers also posted that the product's color changed from can to can.
It turns out that the manufacturer's website is a fake site the Vietnamese distributor set up to bamboozle consumers. Data tracking revealed that the website's source code and admin interface are all in Vietnamese. An advertising video clip featuring Danlait's manufacturing plant and its production process in the French western commune of Maillezais also originated from a Vietnamese account on YouTube.
"How come a leading milk producer in Europe has so much Vietnamese information on their website?" Ha challenged.
One early clear indicator of unscrupulousness on the part of Manh Cam is that one of ingredients listed for the so-called goat-milk based formula is chlorine, a poisonous chemical used to kill bacteria.
"Instead, the ingredient should be chloride," explained Nguyen Duy Thinh from Hanoi University of Technology's Institute of Biotechnology and Food Technology.
The label was provided by the manufacturer F.I.T., which appears to be a Vietnamese operation set up in France with the sole purpose of selling it in Vietnam, where regulations and standards are easier to circumvent. The product would never meet French standards.
And while the Food Administration of Vietnam only certified the product as a "supplementary food" - meaning it only has enough nutrients to be used alongside mothers' milk, baby food or full-on formula - it is still advertised and sold as fully-nutritious milk formula for babies. That means mothers feeding their babies only Danlait have been denying the children vital nutrients. So far, about 6,000 Danlait cans have been temporarily confiscated for the inaccurate labels, but that is the only action the government has taken.
Subsequent investigations also exposed that the price of each can of Danlait goat milk declared by Vietnamese distributor to customs officials is only a fifth of its market price.
"Each can is declared to customs officials as about VND80,000 ($3.8). But the milk is sold in Vietnam from VND450,000-480,000 ($21.5-23)," said Kieu Dinh Canh, deputy head of the Hanoi market management agency's team No.12.
"Manh Cam shows sign of tax evasion," Canh added.
Different brand, same trick
The Manh Cam case is not the only controversy surrounding baby milk issues in Vietnam. Concerned parents and disgruntled consumers have built a convincing case against other companies as well.
There is considerable evidence that Frezzi, marketed in Vietnam as the New Zealand's best colostrums milk powder since 1993, is also a fake foreign brand. Google searches on this dairy brand return almost nothing except for advertisements from the business's website and online baby stores from Vietnam. Members of lamchame.com, an online forum for young parents, further exposed that Frezzi's domain name is registered in Germany by a Vietnamese user and the Ho Chi Minh City-based Online Data Service JSC is its web-hosting provider. Interestingly, the website administrator of the so-called well-known diary company in New Zealand is its Vietnamese authorized distributor of Fansi Ltd.
The company is also accused of adopting deceptive advertising as the brand Frezzi was advertised as having been on the New Zealand market since 1993. In fact, its manufacturer All Green was only founded in 2004 and again, there is very little information about this company to be found on the internet. However, the false advertisement has been removed from the website.
Passing the buck
Nutrition experts have warned that drinking products like Danlait could stunt growth.
"Danlait is only 1314 percent protein, so the mislabeling could affect babies' health, making them more susceptible to infections and diseases," said Pham Cam Yen, a nutrition expert and lecturer at the Hanoi Medical University. In Vietnam, products must contain at least 34 percent protein to be labeled "formula" instead of "supplementary food."
According to media reports, Manh Cam Company, the distributor of Danlait, called the mislabeling "an accidental error" and claimed to have sent out requests to relevant agencies to clear up the issue in hope of avoiding a boycott. Its director even publicly offered a reward of VND1 billion ($47,820) to anyone who could prove the products are fake.
Frezzi's spokesperson, on the other hand, insisted that the company is being defamed by rivals and refused to comment any further. Although officials from the Food Administration said that the certification of Danlait milk followed proper procedures, the regulatory body denied responsibility for checking the products' quality. The administration said that conducting post-certification tests was the responsibility of other agencies.
Who is to blame?
In July 2010, a study by the Ministry of Health brought to notice that only 10 percent of Vietnamese infants are breastfed exclusively in the first six month. Alive and Thrive, an international breastfeeding campaign project, quotes an even fewer number of Vietnamese mothers who exclusive breastfeed in the first six months at 20 percent in rural areas and 8 percent in urban areas. This means almost everyone now needs baby formula.
Although foreign brand is not a certificate of perfect quality, concerns about the quality and domestic infant formula products have prompted Vietnamese parents to clean out their stocks of foreign infant formulas.
Data retrieved from Euromonitor International, the London-based market research and analysis, confirms the trend. According to its annual report, the market of baby food in Vietnam has been heavily dominated by international brands, with the only exception being Vietnam Dairy Products, also known as Vinamilk. It is estimated that 80 percent of Vietnamese parents are likely to buy imported baby food products made by foreign brands such as Nestlé's Nan, Meiji, Abbott's Similac as most international players have somewhat built up a trusted image.
Such growing demand not only enables an industry of fake or low quality milk products to step in to fill the breach, encouraging some Vietnamese businesses like Manh Cam or Fansi Ltd to manufacture substandard, inexpensive foods abroad to be sold here at a premium for windfall gains.
Yet, the problem is not that Vietnamese consumers are so pessimistic about dairy products made locally. The problem is that Vietnamese consumers are often left with nowhere to turn when they run into trouble. Authorities are still not doing enough to monitor the quality of baby food, either domestic or imported, not to mention the transparency of local importers.
"The quality problem is the biggest concern that drives our decision to buy foreign baby formula," said Nguyen Thu Thuy, the mother of a 9-month-old baby-girl.
"Vietnamese products are generally not tested for quality control. They are also not as beneficial as their foreign counterparts, for instance they don't have fortified iron to increase babies' immune system," Thuy explained.
The scandal, undoubtedly, makes restoring consumer confidence and the ruined reputation of Vietnam's product safety system a long way away.
Euromonitor International has not only reported on the Vietnamese government's lack of quality control over baby formula, but has also raised concerns over exaggerated claims from manufacturers that make many young parents think that their products should be better than breast milk.
"Let's face it formula milk has no chance of mimicking breast milk. It is important to keep in mind that while it looks like the formulas have vitamins and minerals, we should question the source of these nutrients," said Dang Hoang Thom, a doctor at the Central Pediatrics Hospital and a breast-feeding advocate.
The pediatrician admitted that many of these added ingredients are not sourced from natural foods, but rather from chemical laboratories. As such, medical practitioners like Thom do not yet know the full ramifications of giving these nutrients to children.
"If you have a choice, baby formula, especially those schlepping through customs that are widely sold in baby stores would be the last thing parents would ever feed their kids," Thom concluded.
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