Unwise to raise domestic dairy prices

Scandals involving foreign dairy companies should not be the reason why domestic dairy companies increase their prices, said an article in Beijing Youth Daily (excerpts below).

Foreign dairy companies have been hit by scandals recently. However, domestic dairy companies should not increase prices.

For instance, Mengniu and Yili, both domestic dairy companies, have increased their prices up to 17 percent.

Domestic companies said that the price rise is due to a shortage of fresh milk.

Maybe so, but the increase in the August milk price from suppliers is no more than 5 percent.

The National Development and Reform Commission launched in August an antitrust investigation targeting foreign dairy companies.

Obviously domestic dairy companies regard it as a good opportunity to win domestic consumers back.

Unfortunately, increasing prices is not the way to do it.

Price increases can harm the domestic companies' brand image and a cheaper price, for a good product is the best way to win back consumer confidence.