such as the pet and infant food problems with melamine have highlighted a
growing discontent with various safety and quality problems in China,
which is a huge supplier market for natural products. At SupplySide East,
Randy Dennin, chairman of the Natural Products Association (NPA) China
office, provided a detailed insider's perspective on regulatory and
market initiatives in China, where NPA opened an office in 2006. The
situation with Chinese quality has gotten so bad, Dennin said most
Chinese consumers prefer imports over products made in their own country.
China is not taking its
problems standing still, as its regulators are working closely with U.S.
regulators and trade associations on several initiatives relative to
regulations, supply chain, communications and various trade issues. In
fact, to counter China's notoriously restrictive regulatory environment,
NPA is working with the U.S. Department of Commerce (USDOC) to address
non-tariff barriers with China’s State Food and Drug Administration
(SFDA). NPA is also initiating testing of Chinese raw materials bound for
the U.S., with the help of USP, which also opened an office in China.
This work is made possible by a Marketing Development Coordinator Program
grant of $160,000, funds that are also helping to stage trade shows in
China and increase online communications in both Chinese and English.
To further the efforts
in the Chinese market, NPA also wrote a white paper on trade barriers to
U.S. dietary supplement makers and marketers, which was published in the
2008 the American Chamber of Commerce’s Annual white paper, delivered to
both U.S. and Chinese governments, and used as a blueprint for advocacy
talks. This white paper suggests replacing the current SFDA registration
process with a notification system, adopting a structure-function claim
system, and overhauling supplement ingredient potency restrictions.
Dennin also provided a
review of China's regulatory environment, including the new food safety
law passed in 2009, which sets up a new food safety committee,
establishes supervision of health foods and details compensation
hierarchy in the face of lawsuits. Some of the issues Dennin and NPA
expressed at the new food safety law include wording that could keep
supplements from sale in China in capsule form. Dennin's regulatory
review covered the 27 approved health claims in addition to the infamous
"blue hat" registration for health foods.
Finally, he took a look
at the market for natural products in China's growing economy. An
estimated $6.48 billion market makes China the fourth largest market for
dietary supplements in the world, with an 8-percent growth rate and a
strong demand for U.S.-made supplements. He further broke the sales
market down into various sales channels and product types.