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Honey Laundering reported from China through Australia into the U.S.

by Alan Harman

China Death threats and a mystery car brake failure followed after a senior figure in the Australian honey industry attempted to expose a racket involving Chinese honey being relabeled and shipped to the United States. "My wife and chldren were in the car when the brakes mysteriously failed within days of the death threats," the man said. The threats came after he warned that the relabeling "had the potential to destroy our industry, not just give it a dent." The man now is so concerned he refused to allow his name to be published. "My wife is terrified," he said. Told of the threats, another big player said he was not surprised. "There's a lot of dollars inviolved in this."

The drama came to light during a Bee Culture investigation into the scale of the Australian honey relabeling operations. This found that up to 2,228 tonnes (nearly 4.5 million pounds) of Chinese honey was shipped to Australia and then re-exported to the United States in the 2001-02 financial year at a time when the U.S. had banned Chinese honey. The figures were published in a survey of the Australian honeybee industry released by the Australian Rural research and Development Corp. The report said: "Australia normally imports a relatively small quantity of honey. However, in 2001-02 Australian honey production dropped markedly due to widespread drought, particularly in the eastern states. Australian honey imports increased with most of these imports subsequently being re-exported by processors to fill export contracts. "Honey imported from Singapore in 2001-02, was most likely sourced from China and, along with other direct imports from China, was mostly re-exported to the United States." This was at a time when the U.S. - along with Canada and the European Union - had banned Chinese honey because of health safety concerns over the levels of the antibiotic chloramphenicol which has been linked to aplastic anaemia, a serious disease with symptoms similar to some cancers.

A table in the report outlined the dramatic changes in Australian imports and exports. It showed imports from Singapore in 1999-2000 and 2000-2001 were exactly zero - not surpising considering Singapore has no bees. But in 2001-02 the Singapore figure skyrocketed to 1,447 tonnes (2.9 million pounds) as Singapore became the world's fourth biggest honey exporter. In the same period imports from China rose from six tonnes (12,000 pounds) three years ago and two tonnes (4,000 pounds) two years ago to 751 tonnes in 2001-02 (1.5 million pounds). At the same time, exports to the United States rose from 108 tonnes in 1999-00 and 168 tonnes in 2000-01 to 2,344 tonnes in 2001-02 - a year when Australian honey production was decimated by the worst drought since European settlement in 1788. A spokesman for the Australian Customs Department said there was not a lot the department could say because a report had been sent to the Department of Public Prosecutions.

Other sources said two Chinese residents living in Sydney were to be prosecuted over the relabeling of Chinese honey as Australian product. Government and industry spokesmen argued the honey never officially entered Australia but was simply transhipped. But they agreed that if this was the case the volumes would not have been included in the Australian import and export statistics. Australian Honey Bee Industry Council (AHBIC) chairman Ray Phillips said in his annual report that the import of honey from China and other places continued to be a sore point with many producers. "Regrettably, at a time when supply is so low it has become necessary for some packers to import honey," he wrote. "It is to be hoped that we return to regular seasons and the need for imports will dry up. "In respect of imports, AHBIC has been successful in ensuring that all imported honey is now tested for chloramphenacol. We are also working with the government to draw up new procedures for the import of honey and its testing.

It is time there was a level playing field between imports and exports and your peak body continues to work to achieve this end." Federal Opposition agriculture spokesman Kerry O'Brien said in a statement that the Australian Quarantine and Inspection Service (AQIS) has admitted knowledge that Chinese honey has been imported into Australia, relabeled as Australian product and reshipped to the U.S. "Under intense Labor Party questioning at a Senate Estimates hearing, AQIS has revealed that Chinese honey shipped in drums has been transited through Australia for the purpose of relabeling the product," he said. "The honey may have been contaminated with chloramphenicol (CAP), which AQIS says causes the disease aplastic anaemia in some susceptible individuals. AQIS could not confirm the number of shipments that have been transited through Australia. "The Senate Estimates hearing also heard that some international honey has been labeled `Product of Australia' and shipped to third countries without even landing on our shores. This honey laundering is occurring on an unknown scale. "According to an AQIS official, Agriculture Minister Warren Truss has known about the problem for up to 12 months. It is clear the minister has failed to act because the committee heard that Australia has no arrangements in place with customers of genuine Australian honey to identify the real product.

"The department says it's a problem for importing countries, but Labor disagrees. This scam has the potential to do serious damage to the reputation of Australian honey producers. Mr Truss must stop ignoring the problem and act to protect the integrity of Australia's honey trade." But Truss said O'Brien's claims were unsubstantiated. "Hollow, unsubstantiated claims of an `ongoing' and clandestine `honey laundering' trade are not only damaging to the Australian honey industry, but also to our international trading reputation," he said. "I urge the Senator to retract his scare mongering comments immediately. "Senator O'Brien makes a habit of issuing media releases which pay scant attention to the facts and, in this case, he could seriously undermine the export efforts of a group of primary producers already battling the effects of drought and fire. "AQIS carries out surveillance testing of all imported honey for chloramphenicol and pesticide contamination and any product failing the testing is not allowed to enter Australia. Chloramphenicol is not registered for use in food production in Australia, including in honey production." Truss said "Product of Australia" labeling must comply with the requirements of the Australian Trade Practices Act (TPA). The TPA is administered by the Australian Competition and Consumer Commission.

"Australian authorities last year became aware of a shipment of Chinese honey transhipped via Australia to the United States that was illegally labeled `Product of Australia', apparently in an attempt to evade U.S. anti-dumping penalties on Chinese honey," Truss said. "AQIS and the Australian Customs Service worked closely with the U.S. Customs Service in uncovering the incident, which was publicly exposed in August. "Claims by Senator O'Brien that the government failed to act on the issue are completely false. The government responded decisively and has kept the honey industry and Parliament informed. "Penalties exist under the Customs Act and the Commerce Trade Descriptions Act, and the government is determined that the full force of the law is brought to bear on offenders," Mr Truss said. "If Senator O'Brien has any evidence to substantiate his claims that such `honey laundering on an unknown scale' is `ongoing' he should provide it immediately to AQIS so that investigations can commence." But Mark Higgins, a board member of Beequal, an AHBIC honey quality assurance operation, said the situation was so serious it risked Australia's premium honey markets throughout Europe, Asia and North America. "This stuff (Chinese honey) is banned in England, in France, in Italy, in Japan, in Canada, but you can get it here in Australia," he said. "As soon as those bans came in, we got drowned in Chinese honey because they can't sell it anywhere else." Higgins said if the Chinese product was mixed with local honey and re-exported it could pose enormous problems.

"It would only take 24 hours for Europe or Canada or Japan to ban our honey," he said. "Our product is recognized around the world because we don't suffer from the same diseases as overseas and we don't use chemicals." Industry players said Australia was not the only country involved in relabeling Chinese honey so it could enter banned markets. They named India, Thailand, Vietnam, Pakistan, Turkey and Malaysia as all using Chinese honey for their export markets. "I would not be surprised if there were only one or two people involved in the whole operation," one source said. "A sort of honey mafia." AHBIC executive director Stephen Ware said the council had alerted honey packers in the U.S. about the Australian problem. "We have written to all major honey buyers warning them of the danger," he said. Asked if he was concerned the relabeling could destroy Australia's export market, he said: "What you are saying is absolutely correct. "We are worried about the effect on the U.S. market. We have urged the Customs Department to do something. When we hear of suspect shipments we alert the Customs Department." Ware said a lot of the honey was transhipped - put into bond in Austraia and then put onto another ship. "We have highlighted the whole issue," he said.

"It is in our long-term interest to address this. We are testing everything we can. We're terribly worried. We know we have a quality product. We don't want our brand name destroyed by illegal blending with Australian honey and called Australian honey. Chinese honey is terible tasting stuff. ""There will be elements that try to shortcut the system and use countries like Australia that have a good reputation," Ware said. "Ninety five percent in our industry are honest but with prices way they are there's a small element trying to cut corners." LATE NEWS; Australian beekeepers said they are getting reports that Royal Jelly with an Australian ceritificate of origin has tested positive in Europe for chloramphenicol. The drug is not used in Australia, indicating Chinese relabeled product now has reached Europe.

Alan Harman

From BeeCulture / Catch the Buzz
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