Chinese demand creates baby-formula shortage in Europe

Chinese demand forces cutbacks at stores elsewhere
2013-04-27T00:00:00Z Chinese demand creates baby-formula shortage in EuropeThe Associated Press The Associated Press
April 27, 2013 12:00 am  • 

BERLIN - Yong-Hee Kim still can't believe that in a prosperous country like Germany, powdered baby formula would ever be rationed, and that she would have to scour shops in the German capital to find the right brand for her 13-month-old son.

But that's what has happened since major retailers in Germany this year began limiting sales of leading brands of baby formula. Parents in Britain, the Netherlands and Hong Kong have faced similar restrictions.

The reason for the sudden shortage is a quirk of globalization - one that illustrates the complexities of supply and demand in a wired world.

Parents thousands of miles away in China have been using the Internet or tapping friends and relatives in Europe to buy up stocks of high-quality European-produced formula - often paying much higher prices than they would here.

Chinese demand for foreign brands soared after drought in Australia and New Zealand cut supplies from China's major sources of imported baby formula. Chinese parents who have enough money have largely shunned local brands since a contaminated-milk scandal in 2008 left six babies dead and another 300,000 sick.

With Chinese consumers turning to sources abroad, major retail outlets in Germany, Britain, the Netherlands and Hong Kong have limited sales of several leading brands of baby formula. In Europe, parents have been stockpiling the milk powder at home, further intensifying the shortage.

"They don't sell more than three boxes of formula per store anymore. So my husband and I are checking out all those stores, running from A to B, to make sure we can get the right baby milk powder for our son," Kim said as she watched her son at a playground in Berlin'.

"We even end up paying two, three or four euros more for a box," she sighed. "It's really annoying."

In Germany, the run on powdered milk started in February, according to DM, a major chain of drug stores, which are the main retail outlets for baby food in this country.

Sales clerks at stores in major tourist venues, including international airports and Berlin's Friedrichstrasse train station, noticed Chinese travelers piling shopping carts to the brim with boxes of one popular brand, Aptamil.

In response, said Christoph Werner, a spokesman for DM, "we decided to limit the amount of Aptamil products temporarily."

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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