Imported Cattle and US Modeled Factory Farms Resuscitate China's Dairy Industry

By Theodora Filis

In 2008, a food and safety scandal involving milk and infant formula, and other food materials and components adulterated with melamine, crippled China's dairy industry. An estimated 300,000 victims -- six infants dying from kidney stones and other kidney damage, and 860 babies hospitalized. The chemical appeared to have been added to milk to cause it to appear to have a higher protein content. In a separate incident four years before, watered-down milk had resulted in 13 infant deaths from malnutrition.

This incident raised concerns over food safety, and political corruption in mainland China, damaging the reputation of China's food exports, with at least 11 countries stopping all imports of mainland Chinese dairy products.

Today, China has allocated a trillion dollars to expand agricultural production, and aims to be 80% self sufficient in food and agriculture over the next decade. For this purpose, China is subsidizing modern US intensive factory farms, and underwriting the cost of importing cattle from around the world to increase their dairy production.

Deng Jiu Qiang, founder and chairman of Modern Dairy, said one of his company's 15 farms, is financed by the US private equity firm KKR, along with other investors, modeled on American factory farms that Deng saw on a US tour a few years ago.

The world's largest milk exporter, New Zealand’s Fonterra, receives Chinese Government subsidies, to boost their dairy farms in China. Fonterra has opened two large dairies totaling 12,000 cows and is building two more dairies, as it plays a part in China's push to meet milk consumption.

According to Alex Frangos, reporter for the Wall Street Journal, “The animals' long nightmare starts on a harrowing journey overseas in ships, where they are confined tightly and cause multiple health issues that may result in death. Those buried at sea might be the luckiest cattle, because once the animals get through the 45-day quarantine, they will continue their confinement in “football-field-size sheds” that resemble electronics factories more than farms and are milked three times a day on “bovine merry-go-rounds.”

Wenonah Hauter, reported, Chinese farmers will need to rely on genetically modified feed – substantially increasing the cost to small farmer's. “Factory farm models have been a failure for public health, the environment and animal welfare in the US, just like it will be for China.”

Given a lack of domestic supply and growing demand from the dairy farming industry, China has an increasing demand for imported US alfalfa products. “This is an extra expense for US dairy farmers who are already squeezed, thanks to low dairy prices and industry consolidation that favors the biggest producers.” said Hauter.

New age music, including a version of “Time to Say Goodbye,” made famous by Andrea Bocelli, plays from loudspeakers while the cows are being milked. Chris Sun, KKR’S representative, says it is meant to calm the cows, though there is no scientific proof that it works.