Juice in China made with poor-quality or rotten fruit

Juice in China made with poor-quality or rotten fruit

Staff Reporter

2013-09-24

As living standards improve in China and the public becomes increasingly health-conscious, the consumption healthy beverages and fruit juice in particular has become an established trend. Juice, however, is not as healthy as many may think, according to Guangzhou’s 21st Century Business Herald. Several major domestic fruit juice producers, such as Haisheng Juice, Huiyuan Juice and Yantai North Andre Juice, are located in proximity to major fruit farms, including in Dangshan in east China’s Anhui province and Pingyi in Shandong province. These companies are thus able to obtain cheaply a large volume of overripe or even rotting fruit for their juices or fruit that fell to the ground before ripening, the paper said.Paying a visit to factories owned by Haisheng Juice and Huiyuan Juice, a reporter found trucks laden with rotten fruit queuing up to enter the factories through the rear entrance. The reporter said he could smell the odor of rotting fruit meters away from the trucks.

Using low-quality fruit allows companies to cut costs and make a considerable profit from the end product. A Dangshan fruit farmer surnamed Chen, who also owns a fruit shop, said that 20-30 tonnes of rotten fruit are shipped to nearby juice factories every day and the volume is sometimes as high as 60 tonnes per day.

An official at Huiyuan Juice denied the allegation and told the paper that some damage to the fruit during delivery is inevitable and noted that the company examines the purchased fruit to ensure that standards are being met.

Government figures show that the total production of beverages nationwide was 1.3 trillion tonnes last year, growing by 10.73% from the previous year. Meanwhile, the production of juice and vegetable beverages was recorded at 22.29 million tonnes, which accounted for 17.16% of the total beverage market, up 16.09% year-on-year.

Following a series of scandals prompting nationwide concern about food safety, consumers in China have begun to question the ingredients used in juices packaged for sale. A nutritionist said that many juice brands contain a large amount of sugar and many of them have food additives including sweeteners, sour agents, color fixatives and preservatives. The public must also be aware that juice claiming to be 100% pure is not really liquid squeezed directly from the fruit but rather a dilution of concentrated fruit juice, the nutritionist added.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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