Govt Orders Monitoring Of Milk Prices

SAUDI ARABIA - The Ministry of Commerce and Industry has ordered that the sale of fresh milk and fresh milk products be governed by the regulations of food supply for extraordinary situations, which stipulates that anyone who hikes price or refuses to sell the products at the previously determined price will be considered violators of the regulations and will be punished.

11 July 2011

1 minute read

Asia

A committee with officials of the provincial governorates and the commerce ministry and municipalities will monitor violations and report to the Interior Ministry for further action, the Saudi Press Agency reported on Sunday.

Following on from this, -Saudi Arabia's Almarai, the region's largest dairy producer, has said that it will cancel a recent price hike for some of its dairy products to comply with the above move.

Almarai is taking the price of its 2 litre fresh milk and laban pack sizes in the kingdom back to levels prior to July 1 with immediate effect, it said in a statement posted on the Saudi bourse website. However, Almarai, which had increased the price of a 2 litre fresh milk and laban pack from 7 Saudi riyals ($1.9) to SAR8 "believes that the rationale and justification for the price increase is still valid."

Almarai's Chief Executive Abdulrahman Al Fadley said that the firm only passed 30 per cent of the increase of costs to its customers and it doesn't intend to hike prices again. He added that sales of its 2 litre fresh milk and laban packs, which account for 50 per cent of the firm's total sales, weren't affected by several boycott campaigns in the kingdom.