This blog is intended to go along with Population: An Introduction to Concepts and Issues, by John R. Weeks, published by Cengage Learning. The latest edition is the 13th (it will be out in January 2020), but this blog is meant to complement any edition of the book by showing the way in which demographic issues are regularly in the news.

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Sunday, April 29, 2012

There's Still a Fortune to be Made From Babies

And, no, I don't mean selling babies--I mean selling to the parents of babies. The Economist this week reports that the Swiss food giant (and I mean giant--check your pantry) Nestlé announced that is buying the infant-nutrition division of American drug company Pfizer for $11.85 billion. Why?
Kurt Schmidt, the boss of Nestlé Nutrition, says it will be worth it. Mr Schmidt is a baby-food veteran, having joined Nestlé in 2007 when it took over Gerber, an American maker of baby food, of which he was the boss...Mr Schmidt is excited about China. “That’s where the births are,” he says. That is not strictly true: Africa has twice as many. But China is where the largest number of mothers are newly rich enough to buy pricey mush. Last year they bought baby food worth $6 billion; by 2016 that number is likely to double, according to analysts at Citigroup, a bank.The baby business is lucrative in China. Chinese mothers dote on their solitary moppets: those who buy packaged baby food typically choose the most expensive type. And they prefer foreign brands: they still remember the melamine scandal of 2008, when at least six babies died because Chinese firms had added a toxic chemical to raw milk to make it appear higher in protein.
When it comes to making money, the birth rate is less important than the number of first (or, in China's case, only) babies with parents and grandparents who have money to spend. 

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