High Prices for Foreign Milk Powder
    2012-01-05 20:06:56     CRIENGLISH.com      Web Editor: Yihang
The Chinese mainland has the highest sales price for foreign-branded milk powder among all other countries around world.

This picture released on Thursday January 5, 2012, shows foreign-brand milk powders dominating more than half of a Chinese supermarket shelf. [Photo: Newspaper.jfdaily.com]

The Chinese mainland has the highest sales price for foreign-branded milk powder among all other countries around world, website Newspaper.jfdaily.com reports on Thursday.

As reported, foreign-branded milk powder manufacturers have frequently increased the prices of their products in recent years, from 200 yuan per box several years ago to today's price of 300 yuan each. Some high-end milk products boast a 400 yuan price tag per box. However, on average these products sell for 20 Euro (165 yuan) each on foreign supermarket shelves.

Despite their high price-tag, foreign-branded milk powders are still winning the hearts of most parents in China, and some buying agents have even rushed abroad to purchase them to sell at home.

Since 2008, the year that melamine-contaminated milk powder was first detected in the Chinese Sanlu Company, foreign-branded milk powders have adjusted their prices together on four different occasions, each time raising the sales price by ten percent. The expensive brands include MeadJohnson, Abbott, Dumex, Nestle, Wyeth, Meiji and Maysu. Some have increased their prices by up to 50%.

So, what is the difference between the mainland brands and the foreign ones?

Wang Dingmian, a senior specialist within China's dairy industry says, "High price and high profit are the two marketing philosophies for foreign milk powder manufacturers".

Wang believes that foreign manufacturers had a high-priced market position for China from the very start, even prior to the 2008 milk scandal. Foreign manufacturers continually strive for high profits.

An anonymous insider has said that for both Chinese and foreign manufacturers, the price of the raw materials used to create milk powders are almost the same. Even after adding fares and tariffs, the gross profit rate of the products from abroad can reach 80% to 100% margins compared to similar figures from Chinese manufacturers.

According to the report, foreign-branded milk powders occupy a 65 percent market share on the Chinese mainland, and its occupation in advanced market reaches nearly 90 percent.



CRIENGLISH.com claims the copyright of all material and information produced originally by our staff. All rights reserved. Reproduction of text for non-commercial purposes only is permitted provided that both the source and author are acknowledged and a notifying email is sent to us.

CRIENGLISH.com holds neither liability nor responsibility for materials attributed to any other source. Such information is provided as reportage and dissemination of information but does not necessarily reflect the opinion of or endorsement by CRI.

Audio Reports more »
Biz Life more »
Policy more »
Markets more »

• China
China News
Chinese Press
• World
Middle East
• Video
Culture Heritage
Beyond Stardom
Dynamic China

Life 360
Panoramic Sports
• Radio
Ways to Listen
• Business
Editor's Choice
Biz Photo
Special Coverage
• Travel
Editor's Pick
What's in
On the Road
• Showbiz
Chinese Films
Music & Stage
Art & Literature
Photo Gallery
Special Coverage
• Language Learning
Ask Pingping and Jules
Chinese Studio
Elementary Chinese
Pop Charts
English News
English Snippets