On October 14, the Chongqing Market Supervision Administration released a report addressing the investigation into the sales of rice by the Youyang County Grain Co., Ltd. According to the “Chongqing Market Supervision” WeChat official account, this matter has garnered significant attention from the city’s government and officials following public complaints.
In response to the allegations regarding the Youyang County Grain Co., Ltd., the Chongqing Market Supervision Administration established a special investigation team composed of 45 members, organized into six working groups. They implemented an in-depth investigation through onsite inspections, document retrieval, invoice verification, ledger comparison, staff interviews, and random sampling of finished products in storage.
The Youyang County Grain Co., Ltd., a wholly-owned subsidiary of the Chongqing Grain Group, primarily engages in grain purchasing, sales, storage, and processing. The company is responsible for managing part of the county’s finished grain (rice) storage. The nature of this finished grain is categorized as commodity grain, which is owned by the company and subject to dynamic rotation while ensuring quantity and quality during its shelf life. The 350 tons of rice mentioned in the public complaints are from the company’s inventory recorded in June 2022. The total amount of rice under investigation for external sales is 116,467.5 kilograms, all of which is commodity grain that has undergone dynamic rotation.
From May 2022 to April 2024, Youyang Grain Company sold a total of 16,221 bags of rice, amounting to 116,467.5 kilograms, with an original shelf life of six months. Per regulations, when a grain company repackages or distributes stored rice, they must update the production date and adjusted shelf life. The new expiration date should reflect the time the rice has already been stored. However, during the dynamic rotation process, the company used “Taoyuan Tribute Rice” packaging to repackage or delegate the repackaging of rice without properly adjusting the shelf life as mandated, effectively extending it. Upon verification, the remaining shelf life of the rice in question ranged from a minimum of 95 days to a maximum of 176 days, and all were sold within the original shelf life.
The investigation also revealed that Youyang Grain Co., Ltd. sold rice with inflated shelf lives to local schools, totaling 1,215 bags and 23,119.5 kilograms. Schools typically place weekly orders based on their consumption, with the company making direct deliveries, typically within 10 days. The special investigation team meticulously compared the purchasing ledgers, usage records from the schools, and the company’s sales data. It was confirmed that all 23,119.5 kilograms of rice were consumed within their original shelf life.
As a result of these findings, the Youyang Grain Company has violated Article 34, Item 10 of the Food Safety Law of the People’s Republic of China, constituting the illegal production and sales of products with falsely labeled expiry dates. The Chongqing Market Supervision Administration has proposed to confiscate illegal gains amounting to 627,360.25 RMB and impose fines totaling 6,900,962.75 RMB. Administrative penalties were also recommended for the company’s original executive director and general manager, as well as the head of the sales department, amounting to 215,700 RMB, 175,400 RMB, and 81,090 RMB respectively. Additionally, the Chongqing Grain Group has taken action by dismissing the executive director and general manager and demoting the sales head to a general employee, while transferring them from their original positions. Any evidence of personnel misconduct has been forwarded to the relevant authorities for further action.
