August 1, 2011

As prices of imported milk powders continued to soar in China, the prices of domestic brands also started to climb recently.

The price of Heilongjiang Wondersun Dairy Co's infant formula increased to RMB218 (US$34) from RMB184 (US$28) per 900g, while other domestic brands also saw different levels of price rises.

An industry insider said that domestic milk powder brands started to improve their raw material quality and product standards after the melamine contamination scandals. The price rises are largely due to increasing production costs.

"The market price decision is in the hands of foreign milk powder producers because consumers have low confidence in domestic products," the source said.

Foreign brands like Wyeth, Newfresh and Abbott raised milk powder prices again at the end of July, the fourth time that foreign formula brands have raised prices this year.