Feed ‘monopoly’ could be challenged

With Pinnacle Feeds, the country’s lone manufacturer of livestock feed increasing its prices this week, Minister of Agriculture and Food Security Indar Weir has served notice that no monopolies in the local market will be supported.

Shortly before meeting, along with Attorney General Dale Marshall, with Pinnacle Feeds to discuss the price increases, Minister Weir said: “This is not just with Pinnacle, this is generally. We see it when we have fuel prices as well, and as a businessman I have seen what competition can do and really and truly it all comes down to how we get other entrants into the market and what role they play in making sure that the consumer gets the best value for their investment and that, equally, the businesses involved also get the best return on their investment.”

He stressed that this is driven by competition.

“Anything else, you will always get a movement where the flooring is always raised at a time when you have increases, like how we are seeing increases in the price of freight and raw materials. But once those inputs come down, the flooring remains the same and then the consumer does not get the benefit always in the reduction,” Weir added.

“And then another time comes where you would see the increases again and that flooring is again changed. So, each and every time it is changed, it is to the disadvantage of the consumer and at the time when the inputs come down you find that prices don’t drop.

“We need to zoom in on this and look to see how we can do the critical analysis to determine what is happening, to see why consumers continue to have to carry the increased costs and don’t benefit from the reductions in the same way that the provider or the businesses or the investor would benefit.”

Weir said the Government recognizes that Pinnacle Feeds is being impacted by increasing freight and grain prices on the international market and that the bottom line would be affected, leading to the company having to find ways to recoup the additional expenditure.

However, the Agriculture Minister said authorities are concerned about the significant increase in the feed prices which initially started at 10 per cent.

“Before we could reach the end of July, and before going back to negotiations, we saw that there was information in the Press suggesting that prices would go up by as high as 26 per cent.

“I then met with the new owners of Pinnacle and we agreed to hold off until August 6. On the 6th of August I went back to Pinnacle Feeds and I told them that we are considering some other options which we are to discuss today, and once we have discussed those we will then determine what will happen with this 26 per cent increase,” Weir explained.
(AH)