Milk prices increase across China
27 November 2007
The average production price of milk in the main dairy-producing areas in northern China has risen 14.3% from last October to US$0.16 per kilogram, Shanghai Securities News reported (in Chinese). The main causes of the increase are the price of feed grains such as corn, higher milk transportation costs and a short supply of cattle due to the rising breeding costs. Retail prices from China's main dairies have diverged, as Sanyuan has raised the price of its fresh milk 10%, while competitors Mengniu and Yili have so far left their prices unchanged. However, Mengniu and Yili will have to raise retail prices sooner or later to cover costs, which have increased three times this year, said an analyst cited by the newspaper.