FAS: LEMON PRICES ARE GOING TO STABILIZE

It is expected that retail prices will go down in the near future. It will be achieved by increasing the share of direct contracts with importers, reducing procurement from intermediaries and applying antimonopoly remedies, emphasizes FAS

FAS had a videoconference meeting with the largest retail chains of Russia.

“We recommend using as few agents as possible in a procurement chain because product prices grow at every stage of procurement, which seriously affects the final price in the end”, emphasized Deputy Head of FAS, Alexei Dotsenko. “Increasing the share of direct procurement of goods from importers and reducing procurement from intermediaries will help retail chains decrease the current retail prices”.

He also advised representatives of retail chains to choose importers more carefully and do not increase procurement lots (not only for lemons).

The latest changes with lemon prices were pointedly analyzed at the meeting.

Head of FAS Anti-Cartel Department, Andrey Tenishev explained: “A number of factors influenced the costs of lemons simultaneously: export dropped to 41% and importers raised prices to 57.7%. The situation aggravated with dissemination of incorrect information about lemon therapeutic qualities against COVID-19. Nevertheless, price distortions could have been avoided or smoothed”.

In FAS opinion, there is a reserve to decrease lemon prices. Apart from balanced pricing policies of retail chains, new export supplies, particularly, from Argentina, also should facilitate it.

During the videoconference, retail chains presented the following retail prices per 1 kg of lemons in their stores as of 23 April 2020*:

Billa – from 399 RUB; Uzbekistan – 629 RUB.

Auhan – Argentina from 365 to 399 RUB, Uzbekistan from 499 RUB.

Magnit – from 300 RUB.

Metro – from 300 to 350 RUB.

Lenta – from 180 до 350 RUB.

Dixy – from 189 to 399 RUB.

Selgros – 399 RUB.

“The market level of retail prices for lemons is acceptable, taking into account that importers have increased ex-works prices. Consumers have a choice: buy lemons in Lenta stores for 180 RUB or from profiteers at 700. Federal chains have extensive networks of stores and consumers always have a choice, even under quarantine restrictions. No need to cave in to rumours and price “fakes” in mass media, make a reasoned choice. FAS is investigating individual cases of gross overpricing and the violators will be punished”, pointed out Andrey Tenishev. “FAS will control every step and stage in pricing”.

*The range of prices within the same retail chain depends on the subject where a particular store is located

It is expected that retail prices will go down in the near future. It will be achieved by increasing the share of direct contracts with importers, reducing procurement from intermediaries and applying antimonopoly remedies, emphasizes FAS

FAS had a videoconference meeting with the largest retail chains of Russia.

“We recommend using as few agents as possible in a procurement chain because product prices grow at every stage of procurement, which seriously affects the final price in the end”, emphasized Deputy Head of FAS, Alexei Dotsenko. “Increasing the share of direct procurement of goods from importers and reducing procurement from intermediaries will help retail chains decrease the current retail prices”.

He also advised representatives of retail chains to choose importers more carefully and do not increase procurement lots (not only for lemons).

The latest changes with lemon prices were pointedly analyzed at the meeting.

Head of FAS Anti-Cartel Department, Andrey Tenishev explained: “A number of factors influenced the costs of lemons simultaneously: export dropped to 41% and importers raised prices to 57.7%. The situation aggravated with dissemination of incorrect information about lemon therapeutic qualities against COVID-19. Nevertheless, price distortions could have been avoided or smoothed”.

In FAS opinion, there is a reserve to decrease lemon prices. Apart from balanced pricing policies of retail chains, new export supplies, particularly, from Argentina, also should facilitate it.

During the videoconference, retail chains presented the following retail prices per 1 kg of lemons in their stores as of 23 April 2020*:

Billa – from 399 RUB; Uzbekistan – 629 RUB.

Auhan – Argentina from 365 to 399 RUB, Uzbekistan from 499 RUB.

Magnit – from 300 RUB.

Metro – from 300 to 350 RUB.

Lenta – from 180 до 350 RUB.

Dixy – from 189 to 399 RUB.

Selgros – 399 RUB.

“The market level of retail prices for lemons is acceptable, taking into account that importers have increased ex-works prices. Consumers have a choice: buy lemons in Lenta stores for 180 RUB or from profiteers at 700. Federal chains have extensive networks of stores and consumers always have a choice, even under quarantine restrictions. No need to cave in to rumours and price “fakes” in mass media, make a reasoned choice. FAS is investigating individual cases of gross overpricing and the violators will be punished”, pointed out Andrey Tenishev. “FAS will control every step and stage in pricing”.

*The range of prices within the same retail chain depends on the subject where a particular store is located