page_title: Grey market
section_title: Infant formula
hierarchical_section_title: Grey market / Goods / Infant formula
caption_attribution_description: English: Parallel goods traders queuing outside SHS Exit C 中文: 水貨客於上水站C出口外面排隊
context_page_description: A grey or gray market refers to the trade of a commodity through distribution channels that are not authorized by the original manufacturer or trade mark proprietor. Grey market products are products traded outside the authorized manufacturer's channel.
context_section_description: Following the 2008 Chinese milk scandal, parents in China lost confidence in locally produced infant formula, creating a demand for European, Japanese and American produced formula. Import restrictions on formula from these sources has led to parents willing to pay a premium for foreign brands leading to the emergence of milk powder runners, who buy formula at ticket price over the counter in Hong Kong, carry the tins over the border to Shenzhen before returning to Hong Kong to repeat the process. The effect of the runners led to a shortage of infant formula in Hong Kong forcing the government to impose an export restriction of two tins per person per trip. The Chinese then turned to Australia, subsequently also caused shortages there and for milk formula producers to ask retailers in the United Kingdom to restrict purchasers to two tins, as there was evidence that milk formula is being purchased for onward shipment to China.
caption: Milk powder runners queuing outside Sheung Shui Station, near the Hong Kong border.
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