There is no competition among retailers in Latvia, says minister of agriculture

Currently there is no competition in Latvia’s retail sector, said Minister of Agriculture Didzis Šmits in an interview to LTV programme Rīta panorāma on Thursday, the 20th of July.
“I believe competition has not worked at all in the retail sector, especially in the food products sector, for years. If you can set the markup for products at 300% plus VAT and still compete, it means there are so few players and the market is so fractured that any interference is logical and necessary,” said Šmits.

The minister also thanked Dobeles Dzirnavnieks grain processing company

for publicly speaking out about this 300% markup for their products in retail trade, adding that it is an example for others as well.
At the same time, the minister also stressed that only companies that are strong in exports and for which Latvian market is not a matter of survival can afford to do something like that. If this was the case, products of specific producers would not be available at certain retailers. “This once again demonstrates that competition in the retail sector, especially food, doesn’t work,” says the minister.
Šmits added that he is not worried about the 300% price markup for Camembert cheese or French champagne. However, if such a markup is put on locally produced cereals or grains, which are part of the basic necessities basket for many Latvian residents, then it becomes an abnormal

and not patriotic price policy.

The minister said he supports the idea to publish information regarding the formation of prices in stores. “The fact that in a situation of a non-existent competition we could see the real picture is a sympathetic idea,” said the minister, adding that this is about “opening”, not regulating prices.
He also added that the Competition Council currently analyses how pricing works for five product groups. The council should present its findings soon.
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