Monday, January 10, 2011
Cheap, poor-quality honey from China is making a sticky mess of the U.S. market
The problem is serious: "If we lose our honey industry in the U.S., there’s going to be massive food shortages like we haven’t seen before," Richard Adee, a South Dakota beekeeper who owns 80,000 honeybee colonies, the largest operation in the U.S., told Leeder. Investigation into "laundered honey" -- Chinese honey that is repackaged and labeled as coming from Malaysia, Indonesian or Taiwan -- began in earnest in 2002. An Australia shipment was labeled as being from Singapore, but was traced back to China because Singapore had no capacity to produce that quantity of honey.
The U.S. levied tariffs against imported honey in 2000. One of the companies that schemed to import Chinese honey into the U.S. and avoid paying tariffs is German food conglomerate Alfred L. Wolff GmbH (ALW). In exchange for contracts with ALW, honey brokers agreed to move Chinese-origin honey through Russia, India, Indonesia, Malaysia, Mongolia, the Philippines, South Korea, Taiwan and Thailand, according to court documents. The brokers falsified documents, repackaged the honey and mislabeled it as molasses or fructose to avoid attention.
In May 2008, two employees of ALW began cooperating with U.S. authorities, Leeder reports. U.S. Attorney Patrick Fitzgerald of Chicago won indictments against six ALW subsidiaries and 11 executives for their role in an $80-million fraud scheme, including Alexander Wolff, the former chief executive of ALW during the time of the alleged crimes. Some of the indicted are still at large.
The U.S. beekeeping industry is trying to counter the bad honey. It has created a Web site, True Source Honey Initiative, where eventually honey sellers will be able to trace honey back to its original hive. U.S. beekeepers are also struggling with sick bees, which has affected the production of domestic honey. Adee, the South Dakota beekeeper, told Leeder, "It’s kind of like they’re running a car-stealing ring. . . . You catch the guy stealing the car and put him out of business. But the guy that’s laundering, the chop shop or the packer, he just finds another supplier. I think it’s going to keep getting worse until we catch a couple of big ones, give them a little jail time." (Read more)