The CEO for Beefmaster, situated in Kimberley in the Northern Cape, Louw van Reenen confirmed in a statement that they received a request to participate in the Competition Commissions enquiry into the beef industry. He says Beefmaster welcomes the process and the opportunity to clarify any issues relating to the investigations and that they are committed to a full and constructive engagement with the Commission. He added that such engagement is healthy for the industry.

The Director for Sparta Foods, Alfred Tau, in turn said in a statement that they view the allegations in a serious light and will address these in the appropriate forum.

“Sparta does not condone collusion, price fixing, irregular or unlawful conduct as far as the purchasing of weaner calves or the sale of beef in South Africa is concerned. Sparta has voluntarily co-operated with the Commission in the past and provided them with all the required information,” says Tau.

The Commission’s Cartels Divisional Manager, Makgale Mohlala, yesterday confirmed to OFM-news that seizure operations were conducted at thirteen premises belonging to the meat suppliers situated in the Northern Cape, Free State and Gauteng. The purpose was to seize evidence that will help with the investigations.

Mohlala said the companies are alleged to have engaged in concerted practices to fix the prices when purchasing weaner calves from farmers and that they allegedly fixed prices at which they sold meat to wholesale and retail customers.

“The companies are meat suppliers which are also known as feedlots. They purchase weaner calves from farmers in order to bulk feed them in preparation for slaughtering in the production of beef. They also sell beef to wholesale and retail customers,” says Mohlala.

He adds that the information they received indicated that these practices are alleged to have been ongoing for about two decades.

“This practice is very much historic and if these meat suppliers are to be found guilty, we are going to refer the matter to the Tribunal for prosecution. If they found them guilty, we are going to request the Tribunal to impose an administrative penalty, equivalent to ten percent of their annual turnover.”

He says higher food prices have a huge impact on especially poor households who spend most of their income on food.

“The Commissions remain committed in its quest to fight collusion in the food sector as a whole, as high prices of food affect the most vulnerable and poor households who spend a disproportionately high percentage of their income on food,” says Mohlala.

-OFM/Mark Steenbok