China: Two major Chinese brewers have denied being part of a price cartel formed to push up beer prices, according to reports of the news agency AFX Asia. Tsingtao and Beijing Yanjing have both said that they have nothing to do with a reported cartel in the country. Speaking to AFX Asia, Sun Xiao with the board office of Tsingtao Brewery said: “I’ve heard about the price cartel, but we are not part of it.”
A Beijing Yanjing Brewery investment department official also denied any participation in the cartel, or plans to increase beer prices in the near term. “We’ve stocked up enough grain for the whole year,” the official told the news agency. “The raw material price hikes will not affect us.”
Domestic production costs have already risen by 7% since the beginning of 2004, as a result of higher grain and packaging materials costs. According to Xinhua Financial Network in China, around 20 regional brewers, mostly in east China, have reportedly formed a cartel with the intention of pushing beer prices up by at least 20% to 30%.
Grain prices, which account for 3% of production costs, have surged by between 13.49% and 18.62% in 36 major cities this month from the February level. Prices for packaging materials, which account for 50% of production costs, have also gone up by around 15% since the beginning of the year, due to strong demand for petrochemicals.
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