Tuesday, July 3, 2012

Sweetener Industry May Benefit from Quality Credit System Construction

On 2 May 2012, the General Administration of Quality Supervision, Inspection and Quarantine of the People's Republic of China issued an announcement to promote the construction of Quality Credit System, aiming to strengthen the social consciousness of quality credit. And both food industry and food additive industry are listed as pilot units. Of course, as a member of the food additive industry, sweetener industry is also on the list. It is predicted that the construction of Quality Credit System may bring some new development opportunities to sweetener industry in China, according to CCM’s June issue of Sweeteners China News.

In fact, since people's consciousness of food safety has enhanced and food safety incidents have frequently emerged in the past few years, Chinese government has taken a number of measures to deal with food safety problems. For example, on 13 Oct. 2011, the Ministry of Health established the National Food Safety Risk Assessment Center in Beijing. This time, food industry and food additive industry are also involved in the announcement mentioned above, which is one measure taken by Chinese government to deal with food safety problems. According to the announcement, local governments shall take a series of measures to strengthen the social consciousness of quality credit: establish enterprise quality credit files with real-name system; found public service platform for products' credit information; strengthen quality credit evaluation system; intensify punishment for missing of quality credit and implement classification supervision by quality credit rating.

For sweetener producers in China, to become a quality credit demonstration unit will be conducive to their development.
Firstly, becoming a quality credit demonstration unit may bring them more opportunities. In fact, as a major downstream market of sweeteners, food industry (including both food and beverages) prefers sweetener suppliers with high quality credit in China attributed to the following two aspects. On one hand, food industry is also listed as a pilot unit in the construction of Quality Credit System. It is believed that in order to enjoy a good development in the future, food enterprises should make efforts to improve the quality of their products. On the other hand, food safety incidents have frequently emerged in China in the past few years, such as the scandal of carcinogens contained in dairy products of Inner Mongolia Mengniu Dairy (Group) Co., Ltd., a major dairy producer in China. Therefore, in addition to improving product quality, food enterprises will also put more emphasis on selecting those raw material suppliers with credible and good corporate image, such as sweetener suppliers with good quality credit. Moreover, if a sweetener producer is a quality credit demonstration unit, its products are easier to get preference from downstream companies.
Secondly, becoming a quality credit demonstration unit makes sweetener producers more likely to get government aid. Actually, Chinese government always encourages the development of those enterprises that follow the government's development plan through various ways, such as reducing tax and providing credit. Since Chinese government has put forward to promote the construction of Quality Trust System, it must encourage enterprises that are actively involved. For example, in order to promote the development of renewable energy and new energy, Chinese government has provided subsidies for fuel ethanol producers since 2004. COFCO Biochemical (Anhui) Co., Ltd., the largest fuel ethanol producer in China, for example, got a subsidy of USD86.46 million from the government in 2011, which is more than the company's sales deficit. 

However, how can a company become a quality credit demonstration unit in China? It is estimated that sweetener producers can make efforts in the following aspects: firstly, the quality of products should conform to the standards both at home and abroad or to industrial standards; secondly, they must pass the random check on product quality carried by local governments; thirdly, they should build up a positive image and reputation.
Source: Sweeteners China News 1206

Content of Sweeteners China News 1206:
China's saccharin output reaches 3,043 tonnes in Q1 2012
CSA releases reward notice to against sugar smuggling
National food safety standard of maltitol launched
Output value of China's beverage industry increases in Jan.-April 2012
Global Sweeteners may suffer net loss in H1 2012
Layn to merge wholly-owned subsidiary
EU makes final verdict of anti-dumping investigation into Chinese cyclamate
Consumption of acesulfame-K in China expected to increase in 2012
Overview of Chinese sorbitol industry in Jan.- May 2012
Sweetener industry may benefit from Quality Credit System construction
FOS drives Shandong Baolingbao and QHT to perform well in Q1 2012
Xiwang Sugar further focuses on HFCS business
Shanghai Suzan starts sucralose project
… …

If you are interested in CCM International’s June issue of Sweeteners China News, please do not hesitate to contact us by +86-20-37616606, or email us at econtact@cnchemicals.com.

Sweeteners China News is a monthly newsletter published by CCM International Limited. Based on China market, CCM offers timely update and close follow up of China’s various kind of sweeteners market dynamics, analyze the market data and trends, Major columns include market dynamic, company dynamic, raw material supply, price update, import & export analysis, Consumption Trend & Competitiveness.

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