PUTRAJAYA (June 1): Dutch Lady Milk Industries Bhd has cautioned that more price hikes could be on the horizon for consumers as cost inflation leaps.
Noting that the dairy product manufacturer is facing industry-wide headwinds — the global supply chain disruption, “unprecedented” global inflation and raw material price volatility — its managing director Ramjeet Kaur Virik said these issues are posing a challenge for the group as it aims to keep its products affordable for consumers.
It should be noted that Dutch Lady has implemented several price hikes last year and early this year for some of its products, according to Ramjeet.
When asked whether more price hikes are under way, Ramjeet said Dutch Lady will continue monitoring the market and its consumers’ sentiments.
“Dairy is not a price control product. Of course we monitor what is happening in the market and to our consumers. There is no regulation per se, so it is up to us. But what we do as the number one dairy company in Malaysia, others will follow, so the responsibility is on us,” she told the press at the Dutch Lady Hari Raya open house in conjunction with World Milk Day.
Amid the raw material price volatility, Ramjeet said that the board had been constantly evaluating and balancing between product prices and the cost structure.
“In Dutch Lady, I call it [the balancing] triangle. On one hand, we have to nourish the nation with affordable dairy products — that is our purpose. On the other hand, we have our commitment to shareholders who are looking for profit. It is the balancing of the two and the price is an outcome of that.
“Balancing the price and profit will continue [going forward], but my expectation is that it will still be tough for us as the global supply chain disruption is still happening,” she said, adding that the group sources raw materials from local suppliers and overseas.
At 2.45pm on Wednesday (June 1), shares in Dutch Lady were trading down two sen or 0.06% at RM33.18 apiece, bringing it a market capitalisation of RM2.12 billion.