Much of the baby formula taken out of Hong Kong may have ended up in the hands of parallel traders.
Voicing that fear to a Legislative Council panel meeting, Secretary for Food and Health Ko Wing- man noted that local sales of infant milk formula went up more than four to five times from 2006 to 2012, whereas the number of newborns increased by just 1.3 times during the period.
Also, some suppliers have asked smaller pharmacies to buy milk formula under a bundle plan including both popular and not-so-popular brands, the special meeting of the Legco panel on food safety and environmental hygiene heard.
Revealing this, Hong Kong General Chamber of Pharmacy chairman Lau Oi-kwok said some pharmacies are worried that the least popular brands will be left on the shelves, as the suppliers are not allowing them to buy just the popular names.
People Power lawmaker Albert Chan Wai-yip called for an investigation by the Independent Commission Against Corruption into any price manipulation for profit by suppliers.
A representative of popular brand Mead Johnson told the panel it needed to study the situation more.
And Lau said he did not know whether suppliers charged different prices when filling orders from chain stores and supermarkets.
Catering lawmaker Tommy Cheung Yu-yan expressed concern that proposed amendments to the Import and Export (General) Regulations would impact the free-market principle and drive up prices.
Ko said the government should have avoided market intervention but the situation has not stabilized because the supply chain is in disarray.
Democratic Party legislator Emily Lau Wai-hing asked whether the government could have inadvertently helped boost sales for formula suppliers by setting up its hotline for parents to place orders.
But Ko denied the charge, saying: "We have promised that the hotline will be scrapped as soon as the supply has stabilized."