Regulator issues food price warning
The top price regulator said yesterday that the food industry, including restaurants, was banned from forming cartels and collectively pushing up commodity prices.
But the National Development and Reform Commission did not prohibit them from raising their prices individually, based on market demand.
The notice follows steady rises in mainland food prices in the past six months, highlighted by a 4.4 per cent year-on-year increase in the Consumer Price Index last month.
The notice also followed an announcement last month from major instant noodle companies who said they would collectively raise the price of products because of price increases for ingredients such as flour and oil.
Another loose association of fast-food companies also said they would ratchet up their retail prices this month, citing the rising cost of eggs, meat, vegetables and grain.
The NDRC said on its website yesterday that no industries were allowed to form alliances to manipulate market prices.
It said associations and companies found to have been involved in price-manipulation or stockpiling to influence market supplies would face severe consequences.
The media should expose any business activities connected to such price manipulation, it said.
The watchdog said most products' prices should be decided by the market, and local price regulators should avoid price intervention except in exceptional circumstances, like natural disasters.
This announcement signalled rejection of a bold move in June by price regulators in Lanzhou , Gansu , that ordered local restaurants to cap the retail price of a popular beef noodle dish at 2.5 yuan, despite soaring beef and flour prices. Lanzhou price officials said the limit was designed to protect ordinary people from rising prices.