VietNam Business: milk

Showing posts with label milk. Show all posts

Thursday, November 4, 2010

Vinamilk licensed to invest in New Zealand

HCMC – The local leading milk producer Vietnam Dairy Products Joint Stock Co. on Saturday received a license from the Ministry of Planning and Investment to set up its presence in New Zealand, the company said in a statement on Sunday.

This is the company’s first project outside Vietnam that would pave the way for it to further penetrate the global milk market, said the milk processor commonly known as Vinamilk. It will buy a 19.3% stake in New Zealand-based Miraka Limited Company which has built a high-class powder milk factory at the center of North Island in the country, Vinamilk said in the statement sent to the Daily.

Vinamilk said that the factory in New Zealand, costing 121 million new Zealand dollars (some VND1.62 trillion) and having annual designed capacity of 32,000 tons of powder milk, would officially operate in August next year. The factory, which uses fresh milk supplied by farmers in New Zealand as feedstock, will sell its products widely on the global market.

The outbound investment project is in line with Vinamilk’s plan to expand its processing capacity and to secure more fresh milk material supplies for its production.

On the home front, Vinamilk has lately developed five cow farms in five provinces of Tuyen Quang, Thanh Hoa, Binh Dinh, Nghe An, and Lam Dong, with the total herd of 5,000 cattle head. The company expects to import 1,000 more cows this year.

Mai Kieu Lien, chairwoman and CEO of Vinamilk, told local reporters in a meeting last Friday that the company forecast its demand for fresh milk in the next five years at 1.3 billion liters annually, but the current local supply was about 200 million liters only. Therefore, the company is developing its own farms.

“We target to secure 40%-50% of fresh milk material demand from our own farms by 2015,” Lien said.

Vinamilk is deploying several projects to enhance its production in the country. The company will put into operation its US$30-million milk factory in Danang City by August next year, which will mainly produce yoghurt and liquid milk products.

By late 2012, two more factories of Vinamilk will operate.

The first one is a US$120-million liquid milk factory with an annual designed capacity of 400 million liters in the first phase and 800 million liters in the second phase. Meanwhile, the other one costing over US$100 million will produce powdered milk for kids with an annual designed capacity of 55,000 tons, four times higher than the current capacity of Vinamilk’s factory now.

Vinamilk currently has 250,000 distributors and retailers, selling nearly 10 million milk products a day. It now has a market share of 40% in Vietnam.

Lien said the company’s local sale revenue in this year to date has amounted to about VND9.6 trillion, equivalent to the whole revenue of last year.

Besides the local market, Vinamilk is also strong in export, obtaining about US$80 million in revenue every year. Its main export markets are the Middle East, Cambodia, the Philippines, and Australia.

In related news, Vinamilk is considering to raise product prices to compensate rising input costs. The company’s CEO said that Vinamilk was calculating to harmonize product prices with the price of fresh milk purchased from farmers.

Tuesday, November 2, 2010

Dairy price control does not violate WTO rules: official

Dairy price control does not violate WTO rules: official A new regulation requiring price registration of imported milk powder products for children does not break any WTO commitments, an official said, rejecting concerns expressed by dairy firms and foreign ambassadors.

The regulation, which comes into effect next month, is also in accordance with a previous government decree that lists milk as one of the commodities whose prices must be kept stable, Nguyen Tien Thoa, head of the Price Management Department at the Ministry of Finance, was quoted by the Vietnam News Agency as saying.

His statement came in response to recent comments from foreign milk companies and five ambassadors of Australia, Canada, New Zealand, the US and EU.

In a joint letter, the ambassadors said the new price control effort will affect Vietnam’s commitments as a WTO member. They also warned that it could also hinder foreign investment.

The Ministry of Finance said the new regulation aims to exert some control over milk prices in Vietnam

Current regulations require only companies with 50 percent state capital to register their prices with the authorities. Starting next month all imported milk powder products for children under six must have their prices registered with the authorities.

Monday, November 1, 2010

Milk circular ‘doesn't break WTO rules'

HA NOI — A new Ministry of Finance regulation on powdered milk price increases does not violate Viet Nam's commitments to the World Trade Organisation (WTO), said the director of the ministry's Price Management Department, Nguyen Tien Thoa.

Circular 122/2010/TT-BTC strictly adhered to Government Decree No 75/2008/ND-CP of June 9, 2008, which defined milk as a commodity in need of price stabilisation, said Thoa. The new regulation would amend the earlier Circular No 104 to prevent unreasonable price hikes of imported powdered milk.

The ministry has not promulgated any new policies, Thoa stressed.

Circular No 122, which takes effect on October 1, stipulates that importers and distributors must register and report the prices of powdered milk products for children under six years of age to the price management agency.

The ministry issued its explanation in response to several foreign-invested dairy distributors and the ambassadors of Australia, Canada, New Zealand, the US and the European Commission.

In a common letter addressed to the ministry, the ambassadors said the new price control mechanism would interfere with Viet Nam's efforts to achieve a market economy as well as its compliance with WTO regulations.

It could also hamper the attraction of foreign investment and development of the labour market, the diplomats said. — VNS

Saturday, October 30, 2010

Official rejects VN’s violations of WTO price policy

The Finance Ministry’s Circular 122/2010/TT-BTC does not break any of
Vietnam's price commitments to the World Trade Organisation (WTO),
said an official.

Director of the ministry’s Price
Management Department Nguyen Tien Thoa said the document strictly
adheres to the Government’s Decree 75/2008/ND-CP of June 9, 2008, which
defines milk as a commodity whose prices should be stabilised. It amends
and supplements earlier Circular 104 in order to prevent unreasonable
price hike of imported powdered milk.

The Finance Ministry did not promulgate any new policy, Thoa stressed.

Circular 122, which will take effect as of October 1, stipulates that
importers and traders must register and report prices of powdered milk
for under six-year-old children to the price management agency.

The Finance Ministry’s explanation followed feedbacks from several
foreign-invested milk trading companies and the Ambassadors of
Australia, Canada , New Zealand , the US and the European Union.

In a common letter addressed to the ministry, the
ambassadors said the new price control mechanism would affect Vietnam
’s efforts towards a market economy as well as its performance of WTO
regulations.

It could also hamper the attraction of foreign investment and development of the labour market, the diplomats said./.

Monday, October 18, 2010

Dairy firms push up prices while they can

Dairy consumers have been angered as some producers jump to increase their prices before a new pricing law takes effect next month.

Under Circular No 122 that applies from October 1, dairy firms must register the price of milk for infants under six with the Ministry of Finance's Price Management Department or the provincial departments of finance. The agreed price would be calculated from the cost of materials and production.

Since the end of last month, some milk brands have increased prices by as much as 10 percent to get in before the new law that aims to stabilise the price of dehydrated children's milk and prevent unreasonable price hikes, Lao Dong (Labour) reports.

For instance, Abbot has adjusted prices on three of its products by 7 percent.

Anmum brand put its price up by 10 percent a few days ago. The price of Abbot's Ensure Gold for adults has jumped by 8 percent to VND470,000 (US$24.7) each 900g tin.

Milk shops on Nguyen Thong Street , district 3, said within a week Abbot's Pediasure brand would also have a price adjustment.

Nguyen Thi Hanh, general director of Sai Gon Co.op, said among the dozens of imported powered milk brands, only Mead Johnson had made a commitment not to boost prices.

For domestic dairy firms, only Hancofood has confirmed not to alter its price tag.

The dairy firms blamed the price increases on high production costs brought on by higher material costs and the changed USD/VND exchange rate.

Experts said, however, that dairy firms spent too much on advertising and sales commissions and passed the added cost to the consumers.

A woman shopping for milk, Thuy Oanh, on Nguyen Du street, Go Vap District was concerned that the circular only applied to powdered milk for six-year-olds so she expected price increases for milk for pregnant women and the elderly.

Apart from the regulations, the Consumer Right Protection Association needs to coordinate with retailers and boycott milk brands that always increase their prices

Saturday, October 16, 2010

Dairy firms push up prices while they can

Dairy consumers have been angered as some producers jump to increase
their prices before a new pricing law takes effect next month.

Under Circular No 122 that applies from October 1, dairy firms must
register the price of milk for infants under six with the Ministry of
Finance's Price Management Department or the provincial departments of
finance. The agreed price would be calculated from the cost of materials
and production.

Since the end of last month, some
milk brands have increased prices by as much as 10 percent to get in
before the new law that aims to stabilise the price of dehydrated
children's milk and prevent unreasonable price hikes, Lao Dong (Labour)
reports.

For instance, Abbot has adjusted prices on three of its products by 7 percent.

Anmum brand put its price up by 10 percent a few days ago. The price
of Abbot's Ensure Gold for adults has jumped by 8 percent to 470,000 VND
(24.7 USD) each 900g tin.

Milk shops on Nguyen
Thong Street , district 3, said within a week Abbot's Pediasure brand
would also have a price adjustment.

Nguyen Thi Hanh,
general director of Sai Gon Co.op, said among the dozens of imported
powered milk brands, only Mead Johnson had made a commitment not to
boost prices.

For domestic dairy firms, only Hancofood has confirmed not to alter its price tag.

The dairy firms blamed the price increases on high production costs
brought on by higher material costs and the changed USD/VND exchange
rate.

Experts said, however, that dairy firms spent
too much on advertising and sales commissions and passed the added cost
to the consumers.

A woman shopping for milk, Thuy
Oanh, on Nguyen Du street , Go Vap District was concerned that the
circular only applied to powdered milk for six-year-olds so she expected
price increases for milk for pregnant women and the elderly.

Apart from the regulations, the Consumer Right Protection Association
needs to coordinate with retailers and boycott milk brands that always
increase their prices./.

Thursday, September 23, 2010

Dairy firms promise stable prices through year's end

Dairy firms promise stable prices through year's end Several dairy companies said they will keep their prices stable through the end of this year, following the introduction of a new rule aimed at tightening government control over baby formula prices.

US producer Mead Johnson was quoted in a report on news website VnExpress as saying that it wishes to “assist” Vietnamese consumers.

The company has also rolled out new packaging for its popular baby formula products which, it said, will help consumers save money.

The company increased its prices by around 5 percent in January.

Hanco, a local milk and beverage company, also promised to keep its prices unchanged.

Meanwhile, other companies told VnExpress that they would not raise prices unless input costs surge sharply in the remaining months.

Vietnam’s largest dairy firm, Vinamilk, said it would try to contain price increases in the face of a recent devaluation of the dong and sugar hikes.

Promises for stable milk prices came after the Ministry of Finance's decision last week to force importers of powdered milk products for children under six to register their prices and production costs with the authorities.

The new rule, which will take effect in October, is aimed at exerting some control over milk prices in Vietnam, which have increased steadily in recent years.

VnExpress cited a retailer in Ho Chi Minh City as saying milk prices have become a huge burden for many families. A lot of parents have switched to local, cheaper milk brands for their children, causing sales of foreign milk to drop.

Further price hikes would be too much for consumers, the retailer said.

Wednesday, September 22, 2010