VietNamNet Bridge – Prices will increase on at least 500 consumer products say domestic producers and suppliers.

Suppliers of imported canned food, spices and confectionary have sent new price quotes to food shops, informing them that confectionary products imported from Europe will have price increases by 10 percent over the previous Tet.  Meanwhile products from Europe will see price increases by eight percent.

According to one shop owner on Cach Mang Thang Tam Road in HCM City suppliers will have to raise prices because the dollar price has increased and material prices have also risen.

Wholesaler, Phuong, the owner of a cosmetics kiosk at An Dong market, said she is providing products to retailers for Christmas and Tet sale at prices higher by 10 percent.

Phuong said that she is now calculating sale prices based on the dollar price of 20-21,000 dong to the dollar - in anticipation that the dollar price may increase further by early 2010. Cosmetics products with well known brand names sold at Ben Thanh and An Dong Markets have increased by five percent in prices.

It is expected that some 500 product items will have new price levels in December. Director of Maximark Supermarket, Nguyen Phuong Thao said 50 suppliers have been informed about price increases so far. The 5-8 percent price increases have been anticipated for confectionary, drinks, canned and processed food, both imports and domestically made products.

Other kinds of products are already becoming more expensive. Dried fruits, for example, have increased by 5,000-10,000 dong per kilo, while dried meat and fish products have risen by 25-30,000 dong per kilo.

Small merchants at Ben Thanh market said they have been offered fruit jams,  a traditional Tet item, at prices higher by 10-20,000 dong per kilo than the previous Tet.

Producers all say price increase are inevitable, as everything is getting more expensive, including dollar prices and raw materials.

Bidrico’s general director Nguyen Dang Hien said raw materials have increased by 28 percent, while Bidrico also has to pay 700 dong more for every dollar it purchases to pay for import materials.

According to the deputy general director of Hancofood, when the dollar price increases by 1,000 dong per dollar, one tonne of powder milk will be three million dong more expensive. Meanwhile, the milk powder price will increase by 26 percent from December 1, 2009, which will make the production costs for dairy products increase by 10-12 percent.

People think dollar price increases will make imports more expensive and keep consumers away, while bringing opportunities to domestic producers. However, Le Van Chinh, advisor of Soncamedia, has denied this, saying domestic producers have also suffered from the expensive dollar, because they need to pay high to import materials for domestic assembling.

Chinh said that the proportion of foreign made materials in some products may reach 99 percent.

VietNamNet/SGTT

Please send us your comments and feedback: