Milk prices unexpectedly shoot up

Huong, an owner of a milk store in District 5, Ho Chi Minh City, said early this week many distributors have increased their prices by up to VND40,000 a can.

For instance, she said, the price of a 800-gramme can of Dumex Mama and Dumex Dulac was raised by 10 per cent and 13 per cent to VND264,000 and VND375,000, respectively.

Nestlé, Friesland Campina Vietnam and Hancofood also announced a price hike of between 3 per cent and 15 per cent on their products.

Nguyen Ngoc Kinh Luan, director of external relations of Friesland Campina Vietnam, said the price of raw material milk did not have anything to do with the price hikes this time.

The main cause was an increase of 18 per cent in the price of packaging materials and up to 54 per cent in the price of other input materials, he said.

The company therefore had to adjust its labor wages upward by 4.5 per cent, he explained.

He said despite the recent slump, raw material milk prices were roughly the same as last year, adding that the company had not increased its retail prices when global material milk surged early this year.

However, many consumers said they were surprised to see powder milk prices soar when raw material milk prices have dropped a whopping 30 per cent since early this year.

A diary expert said there were two reasons for the producers to hike their prices, besides their well-rehearsed explanations of adding more nutrition to the products and changing the products’ design.

The producers had to increase prices to make up for the slumped sales they experienced during the early months of this year, he said.

Hiking prices would also help milk producers to have more capital for regaining and expanding market shares, he added.