Fez -The Moroccan Competition Council argued that some sources suggest that milk manufacturers have colluded to artificial raise prices.
In August 2013, Central Laitière, a market leader in the dairy industry, raised their milk prices. Other operators followed suit. The milk manufacturers used high costs of production to justify the increase.
The Moroccan Competition Council issued a report on Friday about this controversial price change.
The report says that all operators justify the increase in milk prices by higher cost of its production. “But the analysis showed that the direct link between these two elements does not exist, to the extent that the prices of inputs have not increased in 2013, contrary to what happened in previous years.”
The report goes on to clarify: “By contrast, we find out that the higher prices of pasteurized milk coincided with the increase in import prices of milk powder, which does not fit in the production of pasteurized milk but in the derivatives milk."
The Moroccan Council of Competition stressed that there are indices that suggest collusion among the milk operators to artificially raise prices. The Council goes so far to add that if this were true, the milk operators would have violated the Competition Law.
Among these indicators is the speed of COPAG’s and SAFILAIT’s (the second and third largest operators) alignment with the new price of Central Laitière.
The second index, according to the Council, is the fact that all the operators used the same justification for price increases of milk.
Edited by Timothy Filla. Photo courtesy of le360