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Major edible oil makers urged to stabilize prices
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Executives of China's major edible oil manufacturers and guild leaders were summoned to Beijing on Monday for a closed door meeting at which the government required them to step up production to rein in the soaring market prices.

 

An official with the National Development and Reform Commission (NDRC) who asked not to be identified said it was understandable for the edible oil processing firms to raise prices as the continuous rise in the cost of raw materials had increased their production costs.

 

However, the public had responded strongly to the price hikes of edible oils, coming as they did with rapid rises in the prices of other goods, the official said.

 

Edible oil makers were told to "deepen their sense of social responsibility" and "bear the overall interests of the country in mind".

 

Incomplete statistics from various regions show prices of domestic edible oils rose by 20 percent from November last year to June as the prices of peanuts and other oil-bearing products had risen.

 

But the latest weekly market monitoring report by the Ministry of Commerce showed the prices of cooking oil fluctuated only slightly from October 22 to 28, with the prices of peanut oil edging up 0.1 percent from a week earlier, while rapeseed oil was down 0.1 percent, and soybean and blended oils were basically the same.

 

In a statement after the meeting, the NDRC spelled out five requests including the supply of more small-package oil to meet market demand.

 

Oil processors were not allowed to disturb market order or stoke up fears for price hikes by hoarding raw materials, rigging raw material supply, cutting production or restricting supply.

 

Price hikes must be kept within reasonable margins and be made when absolutely necessary, it said, adding that oil processors must enhance cost controls, improve management and absorb the costs from raw materials as much as possible.

 

The NDRC also warned large cooking oil makers not to collude in setting prices or provide short measures or shoddy products.

 

Under current price conditions, enterprises should transfer part of their interests to the people and cherish their public reputation, it said.

 

Industrial associations were required to provide guidance to firms, make sure they abide by laws and regulations, admonish enterprises in cases of unfair competition, and keep market supervisors informed of the malpractice.

 

If the price hikes exceeded the extra production costs, market supervisors would step in, it warned.

 

Without identifying the participating cooking oil makers, the statement said that representatives from business communities had promised to maintain market order with their actions and contribute to the stabilization of market prices.

 

China's consumer price index, a key measure of inflation, rose by 6.2 percent in September after hitting an 11-year high of 6.5 percent in August, while food prices jumped by 16.9 percent from January to September over the same period of last year, figures from the National Bureau of Statistics showed.

 

(Xinhua News Agency November 6, 2007)

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