More firms cut baby formula prices amid China probe

SHANGHAI (AFP) - More companies have cut baby formula prices in China, they said, after coming under government scrutiny in an apparently widening price-fixing investigation.

At least four more firms said they would slash prices in the world's largest market for baby formula, according to separate statements.

The government has yet to confirm any investigation, but state media reported that China's National Development and Reform Commission launched a probe of mainly foreign companies over high prices.

US healthcare firm Abbott Laboratories was "actively cooperating" with the investigation and would lower prices by between four to 12 per cent, it said in a statement late Monday.

Dutch firm Royal FrieslandCampina, which produces the Friso brand, said it cut China prices by five percent from Monday.

A unit of Japanese dairy producer Meiji and a domestic formula manufacturer, Zhejiang Beingmate Technology Industry & Trade, neither of which had been named as being investigated, also said they would reduce prices.

The cuts followed similar moves by France's Danone and Swiss food giant Nestle, which earlier this month cut prices for baby milk by as much as 20 percent.

The probe comes in the face of huge demand for foreign baby formula products in China after a 2008 scandal involving tainted milk that killed six children and sickened more than 300,000.

The government has vowed to crack down on safety violators and called for strict monitoring of milk powder production, in an attempt to restore public trust in domestic companies.

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