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Imported milk prices on the rise again
Several local milk producers and importers have attributed a higher exchange rate and input costs to the rise in milk prices in recent months.
In the first two months of the year, several milk distributors of imported milk powder, including Abbott, Mead Johnson and Dutch Lady, raised milk prices by 7-10 per cent.
Tien Tien Distribution Co., Ltd, for example, the distributor of the Mead Johnson milk brand in Viet Nam, raised the price of its Enfa A+ milk brand by 7-9 percent from January 9.
Friesland Campina Viet Nam increased the price of its Dutch Lady Friso milk powder by 10 percent and fresh milk by 2 percent.
With the increase, the price of a 900-gramme can of Friso Gold step 1 milk powder went up by more than VND20,000 to VND357,000, while a 900-gramme can of Abbott step 1 and 2 milk powder was selling for VND355,000-VND360,000.
Domestic firms Viet Nam Milk Joint-Stock Company (Vinamilk) and Hancofood followed suit, hiking prices on powdered milk and other nutritional products by around 7 per cent.
Other distributors of imported milk, including Meiji and Milax, also announced an increase in milk prices by 8-10 per cent as of March 1.
Nguyen Muoi, a milk distributor in HCM City's District 3, said: "Milk prices are increasing every month. Sometimes the sellers don't remember their prices."
Milk distributors were racing to increase prices without paying attention to the market's response, as it had not led to a fall in sales because milk is an essential item, he added.
Nguyen Thi Hoa, a dairy shop owner in District 2, said consumers were angry because imported milk prices had increased several times in a short time.
Truong Van Toan, of the external relations department of Friesland Campina Viet Nam, blamed the price hike on the appreciation of the US dollar and the higher costs of raw materials and transport.
But analysts said their rationale for explaining prices was unreasonable since many milk distributors had increased milk prices by 7-14 percent in the last few months, while the exchange rate had risen by only slightly more than 3 percent.
In addition, analysts said that blaming the milk price increases on rising costs for raw materials was inaccurate.
Last year, the cost of raw material milk fell to only US$1,700 from its peak of $5,100 per tonne in 2007 due to a melamine scandal, but no milk distributors or producers had cut milk prices.
But when raw materials went up again to about $3,100 per tonne last September, dairy distributors immediately adjusted their prices.
Currently, a tonne of raw material is priced at $3,400-$3,500. Dairy distributors and producers have quickly responded by continuing to raise milk prices.
A representative of a local dairy company who declined to be identified said production costs for a kilo of finished powdered milk was more than VND100,000, including packaging, nutrient additives, management and other costs.
But a 900-gramme can of imported milk and local produced milk selling at VND340,000-VND380,000 and VND147,000-VND150,000 was unreasonable, he said.
vietnamnews
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