Prices for instant noodles, the most popular convenience food in
China, will increase nationwide due to dramatic increases in the
cost of raw materials and product improvement.
Sources from the World Instant Noodle Association China Branch
said that prices will rise beginning tomorrow at an average rate of
about 20 percent, with the highest hike to be around 40
percent.
A Beijing Times report said prices of high-end instant noodles
processed by overseas companies, such as Master Kong from Ting Hsin
International Group and President made by Uni-president Enterprises
Corp, have already climbed from last month, and Thursday's price
increase will mainly come in medium- and lower-cost products from
local producers.
Meng Suhe, director with the external affairs department of the
World Instant Noodle Association China Branch, attributes the price
surge to increased costs over last year for ingredients including
flour, palm oil and seasonings.
The wholesale price of palm oil was 4,200 yuan a ton on average
last year. The cost has jumped to around 8,000 yuan a ton
currently. Flour was priced at 2.04 yuan a kg in 2006 and is now
pegged at 2.16 yuan a kg .
Industry insiders said that 18 percent of instant noodle's costs
are from palm oil and 30 percent come from flour.
"The overall price hikes are an effort by enterprises to save
their lives, as many instant noodle producers, especially
economical product processors, have not made any profit since the
middle of last year," said Meng.
She also attributed the price surge to product improvement to
meet consumer demand for healthier food and environmental
protection. To provide non-fried noodles, organic flour and
seasonings and environmentally friendly packaging, companies are
increasing investment in research and development and upgrading
their facilities.
A sales manager of Ting Hsin International Group, the maker of
the well-known Master Kong brand of instant noodles, told China
Daily that the instant noodle manufacturing costs are up by at
least 16 percent since last year.
"Retail prices of some of our products increased 0.20 yuan per
packet last month in key cities, which consumers feel is
acceptable," said the manager, who asked to remain unnamed. "This
round of price increase is necessary. Otherwise, we cannot survive
under the high-cost pressures."
Wang Jianming, who purchases instant noodles in Beijing's
Shouhang Supermarket, said that his favorite breakfast is still
instant noodles.
"The price increase is understandable, as the price of all
foodstuffs is climbing," he said.
China is the world's top consumer of instant noodles, with sales
exceeding 30 billion packets last year.
(China Daily July 25 2007)
