The Secretary of Commerce instructed this Tuesday the National Commission for the Defense of Competition to initiate investigations for “alleged anti-competitive practices” of mass consumption companies that raised product prices “above general inflation” and thus abused their dominant position in the market.
In the same line, Ministers of the province of Buenos Aires asked “to stop with the unjustified increases” and they cited a survey by the Analogías consultancy that detected increases above the price index in products such as mineral water and sugar.
Resolution 68/2022 published in the Official Gazette orders the Defense of Competition to investigate “those companies linked to the production and marketing of mass consumption products that have increased prices during 2022 as a result of an abuse of their dominant position in the market. ”.
The body, dependent on Commerce, You must submit a report on the progress of this investigation within a maximum period of 30 days.
The investigation ordered by Matías Tombolini’s area responds to a report prepared by the Undersecretary of Policies for the Internal Market, in charge of Hernán López Toledo, which indicated that there are mass consumption companies that, “during the course of this year, have increased prices above general inflation and other variables that affect production costs”.
In this file it is also stated that the companies that have increased prices “could come to have a dominant position in the markets involved” and that “abusive pricing” could constitute anti-competitive conduct subject to sanction.
Although the resolution does not specify what these companies are, it indicates that they are “markets linked to the production and marketing of food” of “mainly national production.”
Products that increased above inflation
In that sense, according to a survey carried out by Analogías and which took 1,280 products from the main 30 mass consumption firms, the companies Coca-Cola, Ledesma, Sancor, Papelera San Andrés de Giles (Felpita, Sweety, Floripel) and Queruclor ( Querubín, Trap, Aktiol, Polyana) are the ones that increased the most above inflation so far this year.
Among these products, Coca-Cola Kin mineral water increased by 208.9% in the first nine months of the yearwhile the company’s energy drinks and soft drinks totaled 127.3% and 88.8%, respectively, compared to inflation that, in that period, was 67.2%.
While, Ledesma sugar, according to the survey, increased 96.2%; and in the case of Sancor, milk rose 169.5%, its children’s line, 93.5%, and cheese, 74.1%.
In the case of Queruclor, detergents, laundry, hand and body soaps rose 101.5%, 93.2% and 79.3%, respectively, according to the report.
However, from Ledesma they denied this type of increase, they assured Télam that the firm spent “almost two years with increases below inflation” and remarked that the company participated in the Care Prices agreement.
Likewise, the company denied having a dominant position and a role in price formation, as it stated that “it only has a 17% share in the production of sugar in Argentina.”
Based on these data, ministers of the Buenos Aires Government asked in their Twitter accounts to “stop with the unjustified” price increases” and asked consumers “not to buy” these brands with the hashtag #SiAumentanNoCompres.
The Minister of Community Development and General Secretary of La Cámpora, Andres Larroqueexpressed that “stopping the abuse of companies is taking care of the table of the Argentines.”
Stop the abuse of companies is to take care of the table of the Argentines.#IfIncreaseDon’tBuy
– Andrés Larroque (@larroqueandres) November 1, 2022
Similarly, the chief of staff, Martin Insaurraldeproposed to the population “not to buy products that rose more than inflation”.
For her part, the Buenos Aires Government Minister, Cristina Alvarez Rodriguezanalyzed that “the increase in prices of food and products of the basic basket is one of the main causes of inflation”.
“Stop the abuse of companies is to take care of the table of the Argentines. Let’s promote responsible consumption,” said the official.
The increase in food prices and products of the basic basket is one of the main causes of inflation.
Stop the abuse of companies is to take care of the table of the Argentines.
We promote responsible consumption. pic.twitter.com/8LrTjNwBAz
– Cristina Alvarez Rodríguez (@CrisAlvarezRod) November 1, 2022
The Analogías report points out that these increases, which exceed inflation, are linked to a “marked shift in compensation” in the value added of the private sector, where business margins increased to the detriment of wages.
Between 2019 and 2022, in the current administration, the real salary accumulates a loss in participation in the added value cake of 1.76%, which adds to the 5.67% of the Government of Mauricio Macri.
Meanwhile, the benefit of capital increased its participation 1.89% between 2016 and 2019, and 4.04% between 2019 and 2022, according to Analogías.
In order to curb the increases in mass consumption products, Economy Minister Sergio Massa announced on Monday that he plans to advance a price stabilization program during the summerwhich will run from December to March.
The objective of this program is “to allow people to go to the supermarket with some peace of mind and security”, in terms of the prices of personal hygiene products, food and mass consumption, Massa said.
Hand in hand with the program, the Government intends, according to the Minister, to make both the control of compliance with regulations and the application of fines to companies in violation more effective.