Chinese find rising price of fiery national liquor unpalatable

Wed Mar 9, 2011 4:48am EST
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By Ben Blanchard

BEIJING (Reuters Life!) - Chinese leaders used it to toast Richard Nixon, Kim Il-sung, Margaret Thatcher and Ho Chi Minh, as well as the founding of the People's Republic of China.

But a 20 percent price rise this year of China's national liquor, Maotai, on the back of tight supply and rising raw material costs has got Chinese consumers hot under the collar, especially as Beijing tries to tackle growing inflation.

Now the Maotai debate has found its way into the annual meeting of China's rubber stamp parliament, normally a much drier affair with hand-picked delegates taking turns to outdo each other in praising government policy.

"As the 'national spirit', it's quite understandable the price adjustment for Maotai has attracted such attention," Guizhou provincial governor Zhao Kezhi told a news conference. Maotai is made in a remote part of the southwestern province.

The cost of raw materials for the fiery drink -- which is essentially composed of mountain water, sorghum and grain -- had gone up by 28 percent, Zhao said.

One lawmaker proposed this week the government should step in and put a stop to the price rise, according to state media.

Zhao did not appear to take that bait.

"This is a company decision," he said, though added the government would, as a general principle, "strengthen management of prices."   Continued...