Melamine use "rampant" in China feed business

HARBIN, China (Reuters) - Use of the industrial chemical melamine, which has made thousands of Chinese infants sick through tainted baby formula, is rampant among farmers and feed-ingredient manufacturers, a Chinese feedmill owner said.

"It is like a chain," said Sun Erwu, who owns a feedmill in Hebei province, the center of the milk-powder scandal.

"If cows are fed with poor feed and produce lower-protein milk, dairy plants will not accept the milk, so many add melamine," Sun told Reuters on the sidelines of a grains conference.

Nitrogen-rich melamine can be added to substandard or watered-down milk to fool quality checks, which often use nitrogen levels to measure the amount of protein in milk. The chemical is used in pesticides and in making plastics.

"Farmers have no idea what melamine is. They only know if they add it, their milk will not be refused."

China has stepped up testing for melamine in feed after milk powder tainted with the chemical made more than 54,000 infants sick and at least four infants died, the latest in a series of health scandals to blight China's food industry.

Sun said he was not surprised when his meal was found to contain melamine as it was so widely used in Hebei and neighboring Shandong province. He said he was the victim but was fined 30,000 yuan ($4,400) nevertheless.

"I have long wanted to test my products, but to test for melamine is expensive and it takes a long time," he said, adding that testing one sample would cost more than 1,000 yuan ($145) -- and then the laboratory cannot pinpoint the contamination to one ingredient in the meal.

"Soymeal can be contaminated, so can corn gluten meal and cottonseed meal -- suppliers add melamine into all these supplements," said Sun.

Adding melamine to lower-protein cottonseed meal could mean a profit of 1,000 yuan more per tonne as melamine can make the protein level look as high as that of rich soymeal, he said.

The cheating was done by milk dealers and milk-collecting stations, which add melamine to milk to increase protein level to the 3 percent requested by dairy plants, said Sun, who sells his feed to dairy cow farmers.

Still, many farmers, which have small numbers of dairy cows, were victims as they were unaware that melamine was added by dealers at collecting stations, he said.

China said on Wednesday the tainted milk scandal had been brought under control and recently tested liquid milk samples showed no traces of a toxic chemical.

"There is no problem," Xiang Yuzhang, the national quality watchdog's chief inspection official, told reporters in Beijing.

"It has been brought under control, more or less. There are no more problems in the market. As far as I know, there will be no more bad news."

(Reporting by Niu Shuping; Editing by Nick Macfie)

($1 = 6.824 Yuan)