Stakeholders Task Regulators on High Prices of Consumer Goods

FCCPC: Poultry, packaging cartels fixing prices

Okon Bassey in Uyo

Stakeholders have raised the  alarm over rising prices of consumer goods in the country, blaming the development on the inability of  relevant government agencies to regulate the activities of business owners and traders.

However, the Federal Competition and Consumer Protection Commission (FCCPC)  has  blamed manipulation of the market  by a “cartel in the poultry industry to keep the prices high in the country.”

The  Executive Vice Chairman/Chief Executive Officer of FCCPC, Mr Tunji Bello, disclosed this at a stakeholders’ meeting held yesterday in Uyo, Akwa Ibom State capital.

He said the meeting was the  continuation of the nationwide advocacy by the commission  against exploitative pricing in the market.

Their findings, he said, were based on investigation by the poultry cartel consisting of big holders that dictate the price for the small holders to sell their products.

Bello said, the small poultry owners used to sell a day-old chick for between N480 and N590 and still made profit. 

He said two big players in the market brought in big money and expanded the market and expectedly they were soon in a position to control 80 to 90 per cent of the poultry market in the city.

He told participants including  captain of industry, MSMEs, market leaders, farmers, transporters, service providers and non-governmental organisations (NGOs), that  two big poultry players, “used their clout and financial muscle to hijack the local poultry farmers association and now dictated that a day-old chick be sold at N1,350.

This, he said, is a curious reversal of the law of the economy of scale which otherwise stipulates that the more you produce, the less the unit price.

According to him, this  explains  why prices of products remained high despite government’s sundry supports to the poultry industry.

 The FCCPC boss posited that in the last one year, the Federal Ministry of Agriculture and Food Security has supported poultry farmers with broilers, vitamins, feeds and cash through various interventions across the six geopolitical zones. 

“For instance, starter mash which sold for N11,000 in October 2023 rose to N14,000 in January this year, N16,500 in March, N21,500 in July and N23,500 in October. 

Bello also reasoned that the high prices of drinks in recyclable packs was substantially caused by “unfair pricing.”

“The cartel in the packaging sector consists of five big players who are in the business of importing and providing local manufacturers with packaging materials. 

“They operate in a mafia-like fashion such that if you choose to leave one of them to check the price of the other, before you would reach the next factory, the first seller would have tipped off the second seller to quote the same price,” he stressed.

He said those engaged in the sharp practices have not been sanctioned, because  FCCPC chose dialogue as the first option “in the spirit of democracy” He  maintained that instead of enforcing the FCCPC act which prescribes stiff penalties ranging from heavy fine to jail terms, spirit of democracy is allowed to reign. 

He called on the business community in Akwa Ibom to collaborate with FCCPC to curb exploitative pricing as well as sanitise the markets. 

To cushion the harsh effects of ongoing economic reforms, he noted that  President Bola Tinubu has introduced a number relief measures like the removal of tariff on food imports, VAT on pharmaceuticals and medical devices, tax waivers for businesses and public transportation as well as providing easy credit for the conversion of vehicles from petrol to CNG. 

“It is only fair that our businessmen and businesswomen and traders share such gains with consumers in form of reduced prices,” he added.

Speakers in the meeting, expressed concern over the high cost of doing business in the country particularly the high interest rates, multiple taxation and the increase in electricity tariff, calling on the federal government to abolish illegal road blocks to reduce the price of food commodities.