:. Food Industry News


Spanish Authorities Probe Food Price Fixing Claims

Source: Reuters
04/04/2008

Madrid, April 4- Spain's consumer watchdog has launched an investigation into price-fixing by food producers following complaints by consumer groups about sharp price rises.

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Spanish inflation has been running at record levels and opposition candidates cited steep rises in food prices to attack the incumbent Socialist government's economic record in the run-up to elections last month.

A statement by the National Competition Commission on its Web site said it was investigating if there had been any anti-competitive activity in the pricing of chicken, eggs and bread, following a request by the Organisation of Consumers and Users.

"In the light of information analysed and especially the numerous statements by business associations in the sector, it is deemed that the latter may constitute practices contrary to the Defence of Competition Act," the statement said.

A spokesman for the Spanish food industry denied charges of price-fixing and accused the government of inaction and trying to shift the blame for price rises on to producers.

"We warned that prices were rising and nobody did a thing. They want to put up a smoke screen and need a scapegoat, so they've grabbed us," Food and Beverage Industry Federation Jorge Jordana told a news conference on Thursday.

He said food prices had risen due to increases in grain and oil prices as well as the cost of packaging and mergers between supermarket chains.

In February, the latest date for which detailed figures are available, the agriculture ministry estimated the price of chicken had risen by 16 percent in the previous 12 months.

Jordana said there were 32,000 food production companies in Spain, which would make pricing deals very difficult: "It is irrational to think of price-fixing with so many companies."

Spain has been particularly vulnerable to rocketing world commodities prices as it does not produce enough grain to meet its needs and relies on imports. The country also lacks grazing land and livestock farmers depend on expensive animal feed.



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