Photos by the author.

China's Terrifying Food Safety Track Record Is Creating Savvier Shoppers

You won’t need to be in China long before you see something in a restaurant that makes you recoil. With the country's history of glow-in-the-dark pork and gutter oil, however, Chinese consumers are turning to imported food, which they regard as...

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Apr 21 2015, 4:00pm

Photos by the author.

Glow-in-the-dark pork. Rat meat sold as lamb. Fake eggs (really). Rice contaminated with cadmium and arsenic. Exploding watermelons. Oil dipped from gutters and re-sold.

READ MORE: A Hong Kong Startup Thinks Glowing Fish Embryos Could Improve Food Safety

You won't need to be in China long before you see something in a restaurant that makes you recoil—like watching your surly waitress at a local Hunan joint methodically singe off her forearm hairs with a lighter as you eat. And it's only a matter of time before you eat something that wrings your insides out for days on end, particularly during the hot, sultry Shanghai summers when foodborne illness seems to strike most often.

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A typical open-air meat vendor in Shanghai.

A number of food scandals in China have made international headlines in recent years, raising concerns around the world about the global food supply. But no one is more scared than the Chinese themselves.

Food safety is "still the number-one concern on consumers' minds," says Andrew Kuiler of The Silk Initiative, a food and beverage consultancy based in Shanghai. "Along with manufacturer's reputations, it's more important than fancy ads and packaging—the one thing they're looking for. The Chinese consumer is becoming very savvy and very suspicious."

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A sidewalk fish-scaling operation.

It's no wonder. News of food scares, whether true or not, are commonplace in Chinese media, from Sina Weibo (China's version of Twitter) to investigative-style news broadcasts. Heavily polluted air, soil pollution from years of aggressive industrial growth—a report about the extent of which the Chinese government has refused to release publicly—and undrinkable tap water don't exactly foster consumer confidence in the state of their vegetables. Significant improvement in the near future is unlikely: Chinese leaders, in a break from their characteristic stoicism, have publicly acknowledged the ongoing struggle with policing the industry, which is characterized by small mom-and-pop producers, making regulation exceptionally difficult.

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Not exactly the picture of food safety.

At the same time, individual purchasing power is pushing upward and international tourism is growing in leaps and bounds, exposing Chinese to countries with longer histories of strict food industry regulation. The result is a food economy in China where the highest value is placed on imported products, which are widely regarded as safer than locally produced foods. This is especially true for dairy products, following a 2008 scandal involving the addition of melamine—an industrial chemical used in plastics—to bolster protein readings in diluted milk. Six infants died and tens of thousands were sickened as a result. The collective horror stoked public demand for imported milk and baby formula to fever pitch; authorities in Hong Kong, the UK, and Australia placed limits on the amount of baby formula that could be brought back to mainland China. The incident was so detrimental to the image of local dairy products that, eight years later, safe milk and baby formula remains a top consumer concern.

"It's common sense that domestic baby formula isn't high quality," says Fay, a single young professional who lives in Shanghai. "I don't pay attention to food sources myself. There are so many issues to pay attention to: pollution, contaminated meat." But if she had a baby, she says, "Of course I would buy imported baby formula."

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Hermetically packaged milk.

Meats also feature heavily in Chinese food scandals, which range from chemical treatments that alter appearance or disguise one animal as another, to butchering sick pigs and selling expired meat. As a consequence, meat is another major food group where imported products triumph over local in consumer minds. This is especially prevalent in wealthier, top-tier cities where residents are more likely able to afford the high prices that imported food commands, a result of heavy import taxes. In Shanghai, a tier-one city with a large expatriate population and a broad offering of international cuisines, finding rib-eye steaks imported from Australia or different grades of Wagyu beef is as simple as visiting one of several high-end supermarkets or specialty butcher shops. There are also a number of online groceries that offer home delivery for a wide range of imported goods, from Maine lobsters to coconuts from Thailand, and yes, imported beef, pork, lamb, poultry, and veal.

Local businesses are cropping up to meet demand for clean, safe food. O'Fresh, a beef importer based in Shanghai, began selling to customers a year ago, when the ban on chilled beef imports from Australia was lifted in China. Kate and Kimi, an online market, began two years ago as a delivery service for a high-end produce supplier, and expanded into a full-service online grocery store with 3,000 different products in order to keep up with demand. IS Seafood, also based in Shanghai, imports sustainably wild-caught fish from Iceland to China.

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Australian beef on sale in Shanghai.

Larger e-commerce platforms have also tapped into consumer demand for imported products, with cross-border food imports a growth category for major industry players including Alibaba and Amazon China. Grocery vertical sites such as Benlai.com and SFBest that target consumers looking for high-quality produce, seafood, and meat are growing in ranks. In Shanghai and higher-tier markets, buying direct from organic farms is another option, though agribusiness experts caution that truly international-standard organic farms are few and far between in China.

High prices for imported food have given rise to a small but growing community of local producers that focus on selling clean, safe food. One such business is NPG, a Hong Kong-based poultry producer, which sells chicken free of antibiotics and hormones for the Chinese market. Organic farms that meet stringent international growing standards are beginning to broaden their markets in Shanghai and surrounding areas. Pollution-free crawfish and black rice grow together on Chongming Island, a government-designated eco-reserve located about 90 minutes from downtown Shanghai that houses a handful of organic farms.

While the government has made sweeping changes, including creating a centralized ministry overseeing food safety and comprehensive food safety laws, those in the industry see a gap between this top-down approach and actual execution. The fragmented nature of the market that includes many small, independent producers requires an expansive network to reinforce safety regulations.

Spanish ham and imported cheese on sale at a high-end market in Shanghai.

Other tools, from the serious to the kitschy, are emerging for consumers to help police their food. A number of different mobile apps help users keep track of known food issues and report new ones. Baidu, China's biggest search provider akin to Google, unveiled a prototype of its "Smart Chopsticks" last September that can detect the use of gutter oil—recycled cooking oil siphoned from restaurant gutters and re-sold—after an April Fool's joke generated serious consumer interest.

"Traceability apps are popular now," Kuiler says, though he notes, "It's grassroots level; I haven't seen anything taken by one of the big distributors and rolled out nationwide. It doesn't have that sort of gravitas yet."

Traceability can be particularly useful in China, where a maze of middlemen along the sourcing chain contributes to murkiness in the industry. China is frequently referred to as a collection of different consumer markets rather than a single large market, with major cities ranked in a government-designated tiered system based on population size, GDP, economic growth rate and geographic location. Monitoring a supply chain, especially for perishables, across five different markets and multiple city tiers with varying levels of sophistication, is quite the feat.

"It comes down to the supply chain is where things tend to be let down," says Kuiler. "There's such a push for supply chain pricing, everyone in the middle is getting squeezed. The issue of people trying to get palms greased for a piece of action, everyone getting squeezed, sometimes shortcuts are made, and tainting happens."

The current state of the market forces consumers to act as their own advocates, though increasingly, high-end grocery stores both on- and offline are assuming the role of curator to draw buyers.

"When I first arrived here, it was not common to see grocery stores promoting their supplier," says Elizabeth Schieffelin of Kate and Kimi. "Now there is pressure on the industry to promote their suppliers. I would imagine that the pressure will continue to grow such that transparency will increase."