China's milk scandal closes 128 producers

BEIJING, Nov. 6 (UPI) -- About 20 percent of dairy producers in China are not operating as a result of the melamine-tainted dairy scandal, Chinese officials said.

Ministry of Industry and Information Technology said 128 of the 638 dairy producers were closed as of Sunday, the state-run Xinhua news agency reported Thursday.

Officials said raw milk purchases rose by 28 percent, milk production was up 58 percent and milk powder increased by 37 percent from Oct. 2 to Nov. 2, government officials said.

Despite the increases, however, restoring public confidence remained slow since the sandal broke in September, said Zhang Li, director general of the ministry's consumer goods industry division, citing high levels of liquid milk inventories at Mengniu and Yili, China's leading dairy producers.

Zhang said better regulation of the milk industry remained difficult because some dairy manufacturers lacked adequate testing equipment.