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Nestlé, Danone cut Chinese infant formula prices in response to pricing probe

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Nestlé, Danone cut Chinese infant formula prices in response to pricing probe

July 05
11:23 2013

Nestlé-owned Wyeth Nutrition and Danone Dumex are slashing the price of their infant formula products in China in response to the launch of an investigation into their pricing practices and suspected anti-monopoly violations.

In a statement sent to DairyReporter.com, Wyeth Nutrition revealed plans to implement a price reduction of between 11% and 20% across China from next Monday (8 July 2013). These cuts will remain in place into 2014, the statement added.

The company has also vowed not to increase the price of any new products over the next year.

Paris-based Danone has also confirmed that its Asian child nutrition business, Danone Dumex, is “preparing a price reduction proposal.”

The cuts come in response to the launch of an investigation by the Chinese National Development and Reform Commission (NDRC) into high infant formula prices in the country and suspected anti-trust law violations.

Wyeth “assessed its pricing practices”

“Wyeth Nutrition respects all Chinese laws and regulations,” said Wyeth Nutrition in a statement. “Following this investigation, Wyeth Nutrition assessed its pricing practices and decided to improve certain sales and marketing practices.”

“In order to meet the NDRC concerns with respect to the affordability of infant formula to the Chinese consumer, and provide quality products at appropriate and affordable prices, Wyeth Nutrition decided to implement a price reduction of key products from 8 July 2013 through 2014. The average reduction will be at 11% with the biggest single product price reduction at 20%,”the statement added.

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