China's big problem : food piracy

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The news that an investigation has been ordered by China's premier,
Wen Jiabao, into the deaths of at least 12 babies after drinking
fake formula milk has led to a renewed quest for manufactuers to
find packaging solutions to help combat the problem.

In addition to those that died, another 229 babies were found to be suffering from malnutrition after drinking the fake formula, which lacked most nutrients. Chinese police have detained 47 people accused of making or selling the formula, mostly in grocery stores in farming areas on the outskirts of the eastern Chinese city of Fuyang. What is perhaps most alarming is that some 40 companies in ten provinces of China were found to be making fake formula and over 100,000 bags of fake milk powder were confiscated.

China's thriving industry in product piracy is best known for copying the latest software, Hollywood movies or designer clothing. Now the problem of faking food is coming to the fore. Of course this is not necessarily new. Consumers are traditionally wary of fruit bearing the Sunkist or Cape label in stores while discarded toxic chemicals have been known to be passed off as table salt. Counterfeiting has also long been a problem for beer and soft drink brands, with repeated cases of fake beer bottles exploding and causing serious injuries.

Additionally rampant and flagrant trademark piracy has affected many brands including Coca-Cola, Starbucks and even a number of leading cheese brands. Copycat or look alike products are flooding the market, such as the local Haagen-Dazs rip off ice cream packs pictured below.

Nestle is one of the biggest international food manufacturers in China and has a clear market lead throughout Asia in the growing baby food segment. Its baby products are generally regarded as premium brands, a position that the company is obviously keen to protect.

"We are not planning to profit from the misfortunes of others but we will make a big effort to ensure products are of the highest quality,"​ said company spokesman Francois-Xavier Perroud earlier this month. "In particular we have been fighting very hard to avoid instances of mislabeling which is obviously damaging for our brands. We believe that parents in China tend to trust established brand and Nestle intends to continue to benefit from this trust."

Perroud confirmed that in the past some non-Nestle products had been repackaged using Nestle packaging and labelling and that this was an issue the company would battle against.

"We will continue to make every effort to ensure that consumers receive the promised product,"​ he said. "In the meantime the company plans to continue the research and development necessary to ensure quality control and the traceability of products."

Problem solver

Stepping up legislation is one way of tackling the problem, and it is an area that the Chinese government is now under even greater pressure to solve. However there are a number of ways in which manufacturers can tackle the problem themselves. The most obvious way is by increasing the safety of packaging. Now many food companies operating both globally and in China are actively seeking a host of packaging and processing solutions to help them in their battle.

One of the many packaging companies offering solutions to brand piracy and fake food is Germany-based Kurz. It has just developed a comprehensive brand protection product range with a selection of component combination possibilities, including a wide range of difficult-to-copy OVDs (optical variable devices) such as holograms and the high-tech Trustseal security option. The company is currently offering this range of solutions to the China market and is expecting increasing interest in light of recent events there.

Kurz has also developed security features based on a complex, hard-to-imitate foil technology. Diffractive effects such as customised-design foils with continuous, ultra-fine geometric patterns, plain foils with multi-angle rainbow colour effects or single-image holograms are available from Kurz on transparent foil.

Writing for​ Anthony Fletcher says that transparent diffractive foils are difficult to imitate because specialist foil-related know-how is required to manufacture them. He also points out that they serve as an additional security feature for protecting important readable information against counterfeiting, like personal data, photos, of manufacture or use-by-dates and warranty codes. The information remains clearly readable at all times but it is protected: any tampering of the foil to falsify the stored data and information will be readily recognisable.

Transparent diffractive foils can also be used to enhance packaging and provide brand protection without modifying the product design. The recognition effect of the original design is fully retained so no new brand building is necessary.

Other anti-counterfeiting solutions on the market include holograms, specialised inks and coatings as well as more technologically driven solutions such as radio tagging and newer forms of bar-coding. With the problem of counterfeiting now coming to the fore these and a host of other solutions will inevitably be coming under closer scrutiny from China manufacturers in the coming months.

This report has been brought to you from Access Asia,​ with additional reporting from Simon Pitman.

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