Milk prices continue to rise
Milk prices continue to rise
Milk prices have risen by 5-10% after two hikes at the end of 2013 and early 2014 following requests from both local and foreign milk manufacturers including Vinamilk, Abbott and Mead Johnson.
In early 2014, the price of both dairy products and ingredients increased rapidly. According to dairy importers, milk powder and butter oil prices in the world market rose from 30 to 57 percent compared to the same period last year.
Specifically, skimmed milk powder reaches US$4,900 per ton, a 34 percent increase compared to the same period last year and fat milk powder reaches US$5,155 per ton, a 43 percent compared to the same period last year.
The price of raw milk also increased by 22 percent in late 2013.
Prices of dairy products in most of Hanoi’s shops increased from 6 to 9 percent on February 11. Some dairy companies including Abbott, Mead Johnson and Vinamilk have already announced new prices.
Specifically, a bottle of Enfa Mama A+ sees an increase of 14 percent while Enfa Grow 3A+ price goes up by 5 percent a bottle. Nestle’s Lactogen Gold increases from US$13 to US$15 per bottle.
Tran Hong Hanh, owner of a dairy store in Hanoi, said that some products’ prices had already been increased before the Lunar New Year. The reason given by dairy distributors was that raw materials’ costs had increased over the month.
“We could adjust the price if raw materials’ costs only increase by 10 percent. However, as the material price is now increasing by 30 to 40 percent, all we can do is to raise the dairy price,” a representative of Nutifood, a local milk producer, told Tuoi Tre.
In other news, the customs department is investigating a dairy enterprise as it is suspected of transfer pricing after reporting a 12 percent rise in its input costs, according to information issued by the Price Management Department.
Nguyen Xuan Truong, an officer of the Price Management Department said the milk company has just requested a 6 – 8 percent rise in its selling price as well as reported a 12 percent rise in its input costs.
According to Nguyen Anh Tuan, head of the Price Management Department, the increase in the firm’s input costs shows signs of transfer pricing. “They said that their current price will cause losses but we don’t think so,” Tuan asserted.
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