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Cleaning up China’s water margin

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Cleaning up China’s water margin
In 2013 China overtook America as the biggest market for bottled water by volume, having virtually doubled in size in the past three years from 19 billion to 37 billion litres, as cheaper ‘normal’ bottled water is now more popular than expensive mineral waters. 

Hygiene and health concerns among China’s rising urban middle class is driving a market where polluted tap water and poor infrastructure are the norm for most households. Sales of bottled water grew from less than US$1 billion in 2005 to US$9 billion in 2012 with an average growth rate of 16.3% between 2010 and 2015.

Unlike the USA, the growth in bottled water sales is not a yuppie fad, but can be a matter of life of death: In April 2014, the entire 2.4 million population of Lanzhou in the north-west China’s Gansu province were advised not to drink city tap water after a leak from an oil pipeline poisoned the lake with carcinogenic benzene, sending residents rushing to buy-up stocks of bottled, presumably pure, water.

Yet Shanghai authorities found that more than a quarter of bottled water sold locally was contaminated with bacteria, and national regulators raised concerns about local standards that allow higher levels of contaminants such as arsenic and cadmium, rather than national more standards. For example, the permitted amount of toxic arsenic is no more than 0.01 milligrams per liter in the national standard, but the allowed maximum amount is 0.05 mg/liter in the Zhejiang provincial standards.

A survey conducted by China’s regulatory authorities on single-use 500ml bottled water samples found high levels of bromate – a suspected carcinogen and in July 2011, more than 30 bottled water brands failed random market inspections. One of these brands contained bacteria 9,000 times the permitted minimum level. In a market where domestic brands sell for as little as 1 yuan (US$0.15) per 500ml bottle, there is little incentive to invest in proper filtration systems.

In addition, a number of scandals have emerged involving brand falsification - nearly 60% of the bottled water jugs (or barrelled water) on the Chinese market are falsely branded, and many illegal water factories bottle water straight from the tap and sell it under the guise of popular brand names. Yet inspectors rarely verify the fake serial numbers on water products - approximately three out of 10,000 serial numbers are authenticated. These realities create a breeding ground for counterfeit bottling and product contamination.

New Rules

In an effort to bring transparency to the water market, the National Health and Family Planning Commission is cleaning up four state Quality Standards covering bottled water and eliminating a number of local and industrial standards under the China National Center for Food Safety Risk Assessment, a state agency in charge of monitoring and assessing food safety risks.

So far, the Commission issued one mandatory standard on 24 December 2014 which will come into effect on 24 May 2015.

To read the full story and find out more about the new standard, subscribe to Packaging Business Insight Asia here.



1 PBIA May2015 web


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