Competition Commission to conduct inquiry into fresh produce market

Business

Johannesburg – The Competition Commission has on Monday announced it will conduct a market inquiry into the country’s fresh produce market to look into features that impede, distort and restrict competitiveness among other issues.

South Africans have been invited to submit their comments on the scope of the inquiry by April 25.

The commission’s draft terms of reference include four themes that will be explored in the inquiry including market dynamics and the impact of key inputs for growers.

The fresh produce market inquiry will shed light on a pivotal sector in the economy as South Africans struggle with the rapidly increasing cost of staple foods including fruits and vegetables, sometimes with no clear understanding of the factors influencing pricing.

The commission said it will look into retailer markups and how they are determined, price discrimination for inputs and market access.

Other subjects to be explored are barriers to entry, the negative impact that high and increasing food prices have on the majority of South Africans.

“We need to understand exactly what the issues that affect the value chain are and how they affect the prices in the end. But we also want to understand within the value chain, in terms of interaction of growers on the market and how they affect small businesses,” said Competition Commission spokesperson Sipho Ngwema.

The commission said the fresh produce sector has a long history of regulation and anti-competitive behaviour in the post-liberalisation period and is highly concentrated with few significant firms active at the processing and retail levels of the food value chain.

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