China fines Unilever for announcing planned price rises

Unilever (UL.NYSE), the world’s second-largest maker of consumer goods, has been fined US$308,000 by the Chinese government for telling the media about its plans to raise prices, Bloomberg reported. Unilever made the announcement in March, and today the National Reform and Development Commission said in a statement that the media reports “disrupted market prices” and caused hoarding. “Severe punishment was meted out this time to break ugly habits and build new rules.” Sales surged as much as 100 times above average volumes for some Unilever products following the March price increase announcement. A warning was also given to food and beverage maker Tingyi against “excessive” price increases. Consumer prices increased 5.4% in March, and have exceeded the government’s target of 4% every month this year.