Competition Commission applauds egg rationing, warns of price hikes
The Competition
Commission has applauded retailers who are rationing eggs, saying they are
doing the right thing.
At the same time, it
sent out a warning to those who try to raise prices amid the bird flu crisis.
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"We are also aware of some of those social media feeds that are high lighting by consumers some of the concern over prices. We have also noted rationing by certain retailers, which we think is an important measure as well. So this is certainly on our radar,” says the Commission's Chief Economist, James Hodge.
Two strains of avian influenza have crippled South African poultry farms.
Hodge says the legal precedent is clear.
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He says if retailers push up prices far beyond their cost, they may be vulnerable to price gouging.
"What is important here is that the courts have clearly indicated that pushing up prices oversupply or demand problem is not a socially equable approach because pushing up prices really just reserves that product for the wealthy. We will be monitoring and ensuring that the price increases are related to the cost increases."
Hodge says price increases may be expected.
"We might expect some cost increases from the egg producers to the retailers certainly, but we can't see retailers exploit that situation and push prices much higher. The rationing is a logical approach, and we have adopted that in the past."
