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Lawyer Appeals over Instant Noodle Price Hike
    2007-07-30 18:28:33     Xinhua

A Beijing lawyer has asked the National Development and Reform Commission (NDRC) to investigate the legitimacy of the recent price jump of perennial Chinese favorite, instant noodles.

The request comes after a packet of instant noodles rose by an average of 20 percent last week, which sparked more public concern over rising food prices in China.

Qiu Baochang, a legal consultant of the China Consumers' Association, said it is acceptable for industries to raise prices if the costs rise, but they should not meet in private and decide on price hikes together.

Qiu said the collective decision might have breached China's Price Law and infringed upon the right of consumers.

Industries are banned by the Price Law from colluding with each other to manipulate prices, according to Qiu. It is also prohibited by the anti-price monopoly regulations drawn up by the NDRC.

Meng Suhe, an official with the Chinese branch of the World Instant Noodle Association, told media last week that major instant noodle makers, who hold a combined 95 percent share of the domestic market, had met and made a collective decision to raise prices.

Meng said the retail price rise was a result of the increased cost of raw materials, namely palm oil which has jumped from 4,200 yuan per ton to 8,000 yuan per ton.

The low-end instant noodles cost only one yuan (13 U.S. cents) per packet before the price change. The highest price rise will be 40 percent, said Meng.

China makes 51 percent of all instant noodles in the world with more than 46 billion packets produced last year.

Qiu Baochang said he had not yet received a response from the NDRC.

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