China's leading high-end spirit band Kweichow Moutai Co., Ltd., announced Sunday that the price of maotai will go up an average of 13 percent from Jan 1, 2010, forecasting a rise in prices of all high-end spirit bands in the Chinese spirit market.

According to the company, a bottle of maotai containing 53 percent alcohol could cost about  yuan ($82.44) when it leaves the distillery next year, 60 yuan more than what it costs now. "Considering the rise in prices of raw materials, the relationship between demand and supply as well as the company's development strategy, raising prices would be a better choice," the company posted yesterday.

"Lots of maotai that was stocked up before are almost sold out, and now retailers have to wait for the arrival of maotai in the next few days," a Moutai Co.'s distributor in Chongqing said in July.

Chen Chen, chief researcher on the food business at Zhongtou consulting center, pointed out maotai has always been a forerunner on inflation of high-end spirit prices. "Maotai's price escalation strategy marked the era of price inflation for all top spirit bands in China," said Chen.

"Besides rise in prices of raw materials and market demand, the government announced an increase in consumption taxation in July, which will undercut spirit producers' profit margins, makes raising prices a trend for all producers," said Chen. He added that it is not unusual for companies to increase product prices right before Spring Festival when sales of many other products also peak.

According to analysts, by the end of 2010, the increased prices will work together with the company's newly-added 10,000 ton production capacity which has been in operation since 2005, resulting in Moutai Co.'s good performances in its profit margin.

Agencies and Dong Minzhi contributed to this story