Although the National Development and Reform Commission repeatedly talked about the stable prices of enterprises and trade associations, Nestle, Ausnutria, and Messin milk powders recently raised the price of some products, with an average increase of 20%, citing rising raw material prices.

Recently, the National Development and Reform Commission convened the “Conference of the Consumer Goods Industry Association of China” to request that the major consumer goods industries not increase their prices. The Dairy Association is also in the scope of the interview. Recently, Dairy Association initiated this initiative because of the rising cost of the dairy industry and the pressure to increase prices. It is understood that this proposal focuses on regulating the behavior of dairy products companies, requiring companies to maintain a reasonable level of price, not to engage in false pretenders, shoddy, short of goods, such as price fraud or disguised price increase in disguise. According to the China Dairy Association, companies should improve their production and operation management, optimize their product mix, etc., to resolve cost pressures, and maintain a reasonable profit while maintaining a stable market price for dairy products.

It is understood that 35 companies such as Sanyuan, Yili and Mengniu have responded to their promises that they will not raise prices and ensure the quality and safety of dairy products.

"The foreign milk powder has seized the mentality that Chinese consumers have lost confidence in domestic milk powder consumption since melamine seizes the market. The current situation of the infant milk powder market has been very severe and is almost monopolized by foreign milk powder." Dairy expert Wang Dingmian accepts " Securities Daily reporter said at the time of the interview.

Zhou Sianran, a food industry researcher at China Investment Consulting Group, believes that since 2005, the cycle of raising milk prices has been getting shorter and shorter.

Nestlé has not given a positive response to this matter.

Who moved the cheese? "Current foreign milk powder has monopolized the first-tier cities, Mead Johnson, Nestle, Wyeth and other foreign brands have occupied more than 55% of the domestic market for high-end infant formula milk powder, while sales accounted for 70% of the baby in China. Infant milk powder has formed a monopoly. Before the outbreak of melamine in China, there was absolutely no such large market share for foreign milk powder,” said Wang Dingmian.

A report released by the General Administration of Customs in March this year showed that the survival conditions of domestically-produced milk powder companies are not optimistic. Of the nearly 2,000 milk enterprises in China, 30% of the 200 large-scale dairy enterprises are losing money, and the remaining 1800 small-scale enterprises are vast. Part of the loss, or even stop production.

It is understood that Nestle's domestic "Neng" 900 grams loaded with 1 paragraph of the current retail price of 230 to 235 yuan, compared with the previous increase of about 20 yuan, 2 retail price of 175 to 180 yuan, up about 10 yuan; Netherlands The price of US milk powder also rose sharply. The first paragraph rose from 198 yuan to 260 yuan, and the second paragraph rose from 180 yuan to 230 yuan.

In addition, Ausnutria confirmed that due to rising raw material costs and other reasons, Ausnutria's “more capacity” products have increased prices, among which, the “recommended” immune boost series now has a suggested retail price of 328 yuan, which was previously recommended retail. The price is 298 yuan.

In the face of price disputes, the foreign milk powder has consistently attributed the rise in raw material costs.

Unlike other foreign brands, Nestlé is the only dairy company in China.

According to "Securities Daily" reporters, Nestle's milk source is in Heilongjiang.

"He will also be between 3.5 yuan and 3.6 yuan per kilogram of raw milk, not more than 3.5 yuan, so that you calculate the amount of the finished product is about 80 yuan, up to 100 yuan, then compared with the price of 235 yuan How could the raw material cost increase? Such a large profit margin cannot be afforded?” said one person familiar with the situation when interviewed by a reporter from the Securities Daily.

He also said: "The so-called "rising raw material prices" is just an excuse."

"Rising raw material prices" has always been the reason why companies started a price increase plan.

Dairy expert Wang Dingmian also believes that the profitability of foreign milk powder companies is huge. Wang Dingmian said that in dairy products, infant milk powder has a high gross margin, so under the big inflationary environment, companies can fully bear and digest the cost caused by rising raw material prices.

The dairy analysts that the reporter contacted also pointed out that the rising cost of raw materials could not be the reason for the increase in the price of foreign milk powder, and the origin of the rise in the price of the top wind in the foreign milk powder enterprises was due to the monopoly position of foreign milk powder companies in the Chinese domestic market.

Ausnutria Dairy (1717.HK) 2010 financial report shows that the company's gross profit increased by approximately 3.02% to approximately RMB 318 million in 2009 from 2009. The chairman of Ausnutria Dairy Co., Ltd. said that the group raised its product sales in 2010. Price, "This move will provide support to the Group's performance in the coming year."

Nestle's annual financial report on February 17 showed that in 2010 the company achieved a net profit of 34.2 billion Swiss francs (about 35.8 billion US dollars), more than twice the previous year's 10.4 billion Swiss francs.

What is different from the past is that the four major brands of Wyeth, Abbott, Mead Johnson, and Dumex have not appeared in the list of foreign milk powders for the first price increase. “The price of other international milk powders will not change too much at present. After all, we have to give the NDRC face and the government keeps talking. Although the control of foreign milk powder is not enough, we must avoid the limelight after all. It's not easy to say," said the person familiar with the matter.

Foreign milk powder robberies “In infant milk powder, China’s domestic dairy companies are very passive. Foreign milk powder has monopolized the infant market in China, and it will take a while to save.” Wang Ding cotton said.

According to statistics, about 80% of China's imported milk powder comes from New Zealand. According to the 2008 China-New Zealand Free Trade Agreement, China's import tariffs on dairy products imported from New Zealand were further lowered in 2011. The tariff of imported milk powder was reduced from 7.5% in 2010 to 6.7 in 2011. %.

After melamine, domestic consumers have increased their trust in foreign brands. Wang Dingmian said, “The current increase in cost has little pressure on high-margin products such as infant milk powder, and the price increase is somewhat irrational. The domestic dairy industry has experienced quality problems one after another and has long been in a state of mistrust, foreign milk powder. It is to use this kind of consumer psychology and philosophy to bind the market and keep increasing prices."

The fundamental reason behind the rise in the price of foreign milk powder is that local milk powder “does not live up to expectations”.

Wang Dingmian believes that the crisis of confidence in the local milk powder has enabled the foreign milk powder to firmly grasp the price increase rights and realize the monopoly of disguised forms.

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