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Consumer agency challenges high milk prices after regional survey
Vietnam’s consumer agency has challenged powdered milk importers justifications of high milk prices following a regional price survey.
Imported powdered milk in Vietnam sometimes retails more than three times the price in neighboring countries, according to a national comparative study released Tuesday.
The report, by the Vietnam Competition Authority under the Ministry of Industry and Trade, was released at a conference on milk prices and management in Hanoi Tuesday.
The survey was conducted on 100 milk products of 10 producers with the cooperation of agencies in neighboring countries, according to Vu Thi Bach Nga, head of the authority’s consumer protection section.
It aimed to verify suspicions that imported powdered milk is sold in Vietnam at the highest price in the world, she said.
Surveyed were 20 products of seven companies – Abbott, Mead Johnson, Nestle, Dumex, Friso, XO and Dutch Lady – in six countries – Indonesia, Malaysia, Singapore, South Korea, Thailand and Vietnam.
According to the survey, retail prices of most milk products in Vietnam were the highest in the region.
The highest price difference was Dumex’s Dugro 1, 2, 3, which sells in Vietnam at two to three times higher than in Thailand, Malaysia and Indonesia.
Other products sell in Vietnam at between 10-70 percent higher than other countries in the survey.
Importers’ reasons groundless
Nga said the survey disproved importer’s claims at the conference that import taxes were to blame for the high prices.
“Vietnam’s import taxes on powdered milk and its ingredients are no more than 10 percent, which are lower than in Thailand [between 9-40 percent],” she said.
The import tax in Indonesia and Malaysia varies from 0–5 percent, which doesn’t explain the huge price discrepancy to consumers, Nga said.
“Milk prices in Vietnam have been 25-30 percent higher, with some products more than 200 percent higher,” she said.
Local importers at the conference listed several justifications for the high prices, all of which Nga rejected. She said they couldn’t blame the drop in the dong’s value saying it only accounted for a possible 6-8 percent price difference.
The importers then shifted the blame to advertisement costs, which Nga immediately refuted saying experts said local producers also advertised their products but their prices were around one third of imported milk.
Price fixing claims
The Prices Management Bureau on Tuesday recommended Vietnam Competition Authority investigate price-fixing claims that milk importers were cooperating to send prices higher.
Nga said there are more than 200 enterprises importing dairy materials and products, which should create a healthy competitive environment.
However, the media has reported exactly the opposite was the case with unreasonably high retail milk prices increasing continuously since 2007.
Tran Dinh Dien, head of the Price Management Bureau under the Ministry of Finance, said the ministry would cooperate with relevant agencies to issue strict measures against violations in trading milk products.
Dao Quang Hai, Deputy Head of the Vietnam Competition Authority, said they would continue investigating and cooperate with relevant agencies to ensure the rights of consumers and dairy enterprises.
Thu Hang
thanhnien
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