March 6, 2012

 

Heilongjiang Wondersun Dairy issues price increase notice

 

 

Heilongjiang Wondersun Dairy had recently issued a notice to its suppliers and distributors to slightly raise the prices of its milk-power and rice-flour products.

 

The company, one of China's largest milk and milk-powder producers based in the northeastern province of Heilongjiang, has just raised the producer prices of its products.

 

Although the notice did not reveal the level of the price rises of its products, an insider discloses that the milk and powder producer has raised the producer prices by 10% and retail prices by more than 12%.

 

Meanwhile, Guangzhou Fengxing Milk increased the prices of its 12 kinds of products last December with the maximum increase nearly 10%.

 

Fengxing Milk recently also decided to raise retail prices of some products from March 1, 2012, as the company says that the continuous price rise of raw materials and supplementary materials has put it under great cost pressure, and the price rises are necessary to ensure the normal supply-demand relationship.

 

Yakult, a famous active lactobacillus milk beverage brand, which had not raised prices in 10 years, has also increased its retail prices from February 1 this year.

 

The retail prices of imported milk powder under well-known brands such as Wythe, Mead Johnson, Abbott Nutrition, Dumex, and Friso have also been raised one after another recently.

 

Wythe launched a series of new powdered milk products with enhanced formulas in China and increased prices by 10-15% last June. It also increased the price in China of one of its high-end infant formulas by 7.94% last December.

 

Mead Johnson, which had not raised prices for two years in China, also plans to launch new products at the end of March and has raised prices by 10-20%.

 

Abbott Nutrition, Dumex, and Friso have also raised the prices of some milk powder and liquid milk on China's market by about 10%.

 

Wang Dingmian, an expert at the milk industry, maintains that formula enhancements and packaging improvements are only excuses for milk and powder producers to raise the prices of its products and the ultimate goal for them is to seek more profits.

 

Market analysts say a new round of price hikes in the milk industry will take place, as strong demand for milk products in China and prices of raw materials and supplementary materials rises will push up the prices of milk products.