The Cooperation Council of Agricultural Organizations (LOSP) is committed to finding solutions to ensure equal Latvian food prices and support for entrepreneurs, LETA agency was informed by Guntis Gūtmanis, chairman of the board of the LOSP.
The LOSP decided on this future course of action at a meeting in which representatives of the Ministry of Economy (ME) and the Ministry of Agriculture (ZM) also participated.
Gūtmanis stated that the report of the Competition Council (KP) on the price markup of food products in retail stores in Latvia was reviewed at the meeting. KP inspections were carried out in several rounds – in the first round for 28 retailers and in the second round for 21 retailers, as well as 40 manufacturers and suppliers.
He explained that KP’s conclusions are alarming, stating that in more than 40% of cases, a large part of the final price of goods is formed at the stage of the retail supply chain. Similarly, in 50% of cases, the average price markup for goods produced in Latvia in the 17-month period was higher than for imported goods, while in 13% of cases, the opposite results were found.
Gūtmanis noted that there is free market competition in Latvia and shopkeepers can act as they see fit to make a profit by setting mark-ups for food products, however, a significantly higher mark-up for Latvian food products causes concern. This means that with a lower price for imported goods, shopkeepers motivate buyers to buy imported rather than Latvian goods. He explains that the markup set by the store directly affects the final price of the product.
Gūtmanis also pointed out that when examining the issue of markup of goods in trade chains, it was concluded that the markup of imported food products is higher than that of local products at the trading points of neighboring countries. In Lithuania and Estonia, local production is at least 65% in stores, and compared to imported goods, it has a competitive final price.
Therefore, it is necessary to understand the differences between Latvia and its neighboring countries.
It should be clarified whether the markup of goods for Latvian production is formed due to the lack of patriotism of traders, or whether the current situation has some regulatory reasons.
If there are, then you need to decide how to correct the situation.
The chairman of the LOSP board said that farmers have established good cooperation with the Ministry of Economy, Ministry of Economy and the Competition Council, therefore it was jointly decided that the reasons for the different situation with neighboring countries should be clarified at the beginning and then solutions can be made at the regulatory level. Solutions must be sought to support Latvian businessmen and citizens to provide local food at equivalent prices.
Tags: solutions provide local food residents equivalent prices
