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Supply Chain Issues in China’s Milk Adulteration Incident

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  • Gale, H. Frederick, Jr.
  • Hu, Dinghuan
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    Abstract

    China’s melamine milk adulteration crisis highlights the challenges that arise as large well-capitalized companies procure raw materials from a diffused supply chain of scattered small farmers and milk collection stations. As milk prices climbed sharply in 2007 and companies branched out into new territories, intense competition for raw milk supplies strengthened incentives to water down and adulterate milk. Effective food safety measures must account for incentives, the distribution of market power in the supply chain and market dynamics.

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    File URL: http://purl.umn.edu/51613
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    Bibliographic Info

    Paper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 51613.

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    Date of creation: 2009
    Date of revision:
    Handle: RePEc:ags:iaae09:51613

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    Web page: http://www.iaae-agecon.org/
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    Related research

    Keywords: China; milk; dairy industry; food safety; adulteration; market structure; supply chain; Agribusiness; Food Consumption/Nutrition/Food Safety; Industrial Organization; Livestock Production/Industries;

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    Cited by:
    1. Chen, Chialin & Zhang, Jun & Delaurentis, Teresa, 2014. "Quality control in food supply chain management: An analytical model and case study of the adulterated milk incident in China," International Journal of Production Economics, Elsevier, vol. 152(C), pages 188-199.
    2. Jia, Xiangping & Huang, Jikun & Luan, Hao & Rozelle, Scott & Swinnen, Johan, 2012. "China’s Milk Scandal, government policy and production decisions of dairy farmers: The case of Greater Beijing," Food Policy, Elsevier, vol. 37(4), pages 390-400.
    3. Xiu, Changbai & Klein, K.K., 2010. "Melamine in milk products in China: Examining the factors that led to deliberate use of the contaminant," Food Policy, Elsevier, vol. 35(5), pages 463-470, October.
    4. Waldron, Scott & Brown, Colin & Longworth, John, 2010. "A critique of high-value supply chains as a means of modernising agriculture in China: The case of the beef industry," Food Policy, Elsevier, vol. 35(5), pages 479-487, October.

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