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Jiugui halts trading after safety claim
According to the business portal 21cbh.com on November 19, three types of plasticizer (DEHP, DIBP and DBP) were found in four bottles of Jiugui liquor which were bought by 21cbh staff for 438 yuan ($70.30) per bottle and tested by Intertek China, an international third-party quality tester.

Local equities mixed, brewers fall on safety concerns

Responses

●Fan Zhen, deputy general manager of Jiugui Liquor Co, told China National Radio Monday that the company has discussed the matter with 21cbh.com and could not verify that the tested liquor product was produced by Jiugui.

Intertek China test results are dubious since the third party certification company is a commercial agency, but Jiugui has submitted its products to an authoritative testing department, Fan said, adding that the company is unsure when its stock will resume trading on the Shenzhen Stock Exchange.

●The China Alcoholic Drinks Association claimed late Monday that though most domestic liquor products contain plasticizers, the amount they contain is certainly below food industry standards.

The industry association said that the plasticizer found in liquor is mainly caused by the use of plastic in the liquor production process, while the fermenting process of the liquor itself does not generate plasticizer.

●"The entire testing process of Intertek is in accordance with Chinese standards," said Henry Lin, a spokesperson for the Shanghai office of Intertek

●The quality watchdog in Hunan Province, where Jiugui Liquor is located, said in a statement released Tuesday evening that the investigation so far shows no evidence proving Jiugui has intentionally put plasticizer in its products.

"We'll continue our investigation and any illegal activity will be punished according to the law," Hunan's Administration of Quality and Technology Supervision said on its website.

Test Results

The amounts of DBP reached 1.08 milligrams per kilogram, 260 percent higher than the domestic industrial standard of 0.3 milligrams per kilogram, while the other two types did not exceed industrial standards, according to 21cbh.com.

About Plasticizer

The plasticizers are chiefly used in plastics, but recently some food producers have used them as a food additive in order to condense beverages, such as tea drinks and fruit juice, for a more appealing product.

In July 2011, China's Certification and Accreditation Administration passed the first plasticizer inspection standard to monitor the use of plasticizers in the food sector, tracking 22 types of phthalate in foods.

Consuming foods with excessive plasticizers over a long period would pose a definite health risk, since it can damage the human immune and digestive systems.

Effects

Shenzhen-listed Jiugui Liquor Co announced on November 19 a temporary halt of stock trading to protect its investors' interests after reports of food safety issues surfaced.

The stock market in the domestic liquor industry gloomed. And brewing stocks declined sharply.

It triggered food safety concerns once again among the public.

Changes in market value of domestic distilleries on November 19
	Ups rate (%)	Market value (10,000 yuan)
Wuliangye Yibin	-5.82	-683,272.04
Kweichow Moutai	-4.61	-1,074,516.30
Hengshui Laobaigan	-10.01	-49,000.00
Shui Jing Fang	-7.09	-75,724.58
Gujinggong	-4.95	-80,576.00
Yanghe	-5.25	-610,200.00
Fen Liquor	-5.34	-174,035.49
Luzhou Liquor	-6.13	-302,025.97
Source: Shanghai Stock Exchange and Shenzhen Stock Exchange

Viewpoints

Low-quality plastic packages and raw materials will lead to foods and beverages having excessive plasticizers. Some business people may even artificially add plasticizers to make their products look dense and tasty. The public should only believe official food safety reports issued by the authorities.------Wang Shiping, a food safety professor from China Agricultural University

Notwithstanding the influence of this report, the drop in the liquor stock market is normal, as previous stock prices have been riding too high and demand is currently diminishing amid the sluggish economy.------Fan Jie, an industry analyst from Adfaith Consulting

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