(Yicai Global) June 28 -- With China’s milk powder industry struggling, the number of firms taking part in the Children Baby Maternity Expo in Shanghai is much less than in previous years. Survey findings released at the three-day expo, which opened today, also showed that the mother and baby sector is facing more challenges than last year.

The floor map of this year’s CBME showed that there are fewer milk powder makers than in previous years. Only a few brands such as Beingmate Baby & Child Food, Beidahuang Wandashan Diary, and Bright Dairy & Food are exhibiting.

Most booths in the milk powder hall are for nutrition and food brands, unlike in the past few years, when many milk powder companies came along.

A domestic milk powder company’s representative told Yicai Global that they skipped the expo because of operational issues this year. He said that the number of milk powder exhibitors at the CBME was low, just like at the Jingzheng Beijing International Expo of Pregnancy Infant and Baby Products & Education and Toy Brands in April and the Hangzhou National Baby & Mother Exhibition in May.

The absence of these firms at this year’s CBME was expected, said Shi Qiong, chairman and president of baby product firm Babemax. The milk powder industry is in a slump, the cost of participating in the exhibition is high, and most companies have cut costs, he added.

Independent dairy analyst Song Liang also said that the secondary registration of infant formula was ongoing, but the success rate was low, thus some small- and mid-sized brands faced an unclear future and lacked the motivation to join the exhibition.

The CBME Pregnancy, Infant and Child Big Health Insight Report released at the expo showed that from January to April this year, the maternal and infant channel’s milk powder sales and gross profit sank 42 percent and 41 percent, respectively.

The market slump also hit fast-growing online channel sales. JD.Com’s baby formula business fell 7.9 percent and Taobao’s baby milk powder sales also declined by 11.8 percent in the same period.

Song suggested that the impact of China’s low birth rate will still be felt in the next two years, with the market for milk powder stuck in the doldrums. He said that to ease the current situation, the maternal and infant channel should look for new breakthroughs in other areas such as family nutrition.

Editor: Peter Thomas