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  /Page 15Instant noodle staple now set for a round of price increasesBy Liu Jie Updated: 2007-07-25 06:53Prices for instant noodles, the most popular convenience food in China, willincrease nationwide due to dramatic increases in the cost of raw materials andproduct improvement.Sources from the World Instant Noodle Association China Branch said thatprices will rise beginning tomorrow at an average rate of about 20 percent, withthe highest hike to be around 40 percent.A Beijing Times report said prices of high-end instant noodles processed byoverseas companies, such as Master Kong from Ting Hsin International Group andPresident made by Uni-president Enterprises Corp, have already climbed from lastmonth, and Thursdays price increase will mainly come in medium- and lower-costproducts from local producers.Meng Suhe, director with the external affairs department of the World InstantNoodle Association China Branch, attributes the price surge to increased costsover 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 at2.04 yuan a kg in 2006 and is now pegged at 2.16 yuan a kg .Industry insiders said that 18 percent of instant noodles costs are frompalm oil and 30 percent come from flour.”The overall price hikes are an effort by enterprises to save their lives, asmany instant noodle producers, especially economical product processors, havenot made any profit since the middle of last year,” said Meng.She also attributed the price surge to product improvement to meet consumerdemand for healthier food and environmental protection. To provide non-friednoodles, organic flour and seasonings and environmentally friendly packaging,companies are increasing investment in research and development and upgradingtheir facilities.A sales manager of Ting Hsin International Group, the maker of the well-knownMaster Kong brand of instant noodles, told China Daily that the instant noodlemanufacturing costs are up by at least 16 percent since last year.”Retail prices of some of our products increased 0.20 yuan per packet lastmonth in key cities, which consumers feel is acceptable,” said the manager, whoasked 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 Beijings ShouhangSupermarket, said that his favorite breakfast is still instant noodles.”The price increase is understandable, as the price of all foodstuffs isclimbing,” he said.China is the worlds top consumer of instant noodles, with sales exceeding 30billion packets last year.(China Daily 07/25/2007 page15)  China Daily PDF Edition 

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