Imported baby milk products become cheaper in China
中国进口婴儿奶粉开始降价

Starting from this month, it will become cheaper to buy a slew of imported products in China. That includes baby milk formula of foreign companies, which costs many times that of their local counterparts. Stella Lee speaks to some parents about their concerns.

China’s one child policy has meant that parents focused their resources on just one child. That included the most expensive baby milk formula, imported from overseas.

Reporter: "A trade policy that will kick in this month involves the lowering of tariffs for hundreds of imported products including baby milk formula-- to support China’s increased domestic consumption. But experts say whether those lowered costs gets passed onto consumers hinges on the decisions of milk importers and distributors."

"In the short term those will be the immediate beneficiaries, as their costs are lowered. Its all up to them how much they want to sell them at wholesale prices to the market. It will take some time for the market to react and get some long term price guidance." Chen Lianfang, senior analyst of Beijing Orient Agribusiness, said.

And the sooner prices come down the better. Those savings are especially important to mothers like this lady in Beijing--where a month’s supply of foreign imported milk can run into the thousands in RMB.

"I don’t really trust local milk brands. So I’ll be really happy if prices for imported milk formula come down. "

Though foreign baby milk formula costs significantly more, many parents opt to skip local Chinese brands due to contamination and other safety fears. But even with projected cheaper prices some are still cautious.

"For me to play safe I will continue to have family and friends bring it from Australia."

"Too cumbersome to bring from overseas, but after all its my only child"

In a policy change last year where some Chinese couples are allowed to raise two children, experts say foreign imports of baby formula are set to grow mainly into the upper tiered cities.

"What may happen is that imported ones may dominate the tier 1 cities. And domestic brands in the face of more competition may choose to go to smaller cities, to the tier 3 and tier 4.” Chen said.

Tariff cuts on baby milk formula are just part of the government’s broader plans to complement other policies. This comes at a time when China is encouraging urbanization and increased consumption in the economy.