Milk prices unexpectedly shoot up

While the prices of raw material milk imports are falling, some diary producers have shocked consumers with their unexpected price hike of up to 15 percent.
Huong, an owner of a milk store in District 5, Ho Chi Minh City, said early this week many distributors have increased their prices by up to 40,000 dong a can.

For instance, she said, the price of a 800-gram can of Dumex Mama and Dumex Dulac was raised by 10 percent and 13 percent to 264,000 dong and 375,000 dong, respectively.

Nestlé, Friesland Campina Vietnam and Hancofood also announced a price hike of between 3 percent and 15 percent on their products.

Nguyen Ngoc Kinh Luan, director of external relations of Friesland Campina Vietnam, said the price of raw material milk did not have anything to do with the price hikes this time.

The main cause was an increase of 18 percent in the price of packaging materials and up to 54 percent in the price of other input materials, he said.

The company therefore had to adjust its labor wages upward by 4.5 percent, he explained.

He said despite the recent slump, raw material milk prices were roughly the same as last year, adding that the company had not increased its retail prices when global material milk surged early this year.

However, many consumers said they were surprised to see powder milk prices soar when raw material milk prices have dropped a whopping 30 percent since early this year.

A diary expert said there were two reasons for the producers to hike their prices, besides their well-rehearsed explanations of adding more nutrition to the products and changing the products’ design.

The producers had to increase prices to make up for the slumped sales they experienced during the early months of this year, he said.

Hiking prices would also help milk producers to have more capital for regaining and expanding market shares, he added.
Tuoi Tre

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Posted by VBN on Sep 17 2011. Filed under Food & Beverage. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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