COMMERCE Minister Antonis Michaelides yesterday accused opposition parties of creating undue anxiety among consumers by exaggerating and dramatising recent price hikes.
Michaelides warned that by misleading the public there was a danger of creating wrong impressions which could result in further price increases and creating a problem where none existed.
“It might prompt someone who has not increased his prices to question ‘but if everyone else is increasing the prices why should I not increase them too’,” he said.
The minister said he could not rule the possibility of isolated price increases on certain goods but said opposition parties had dramatised things to a much greater extent than the situation warranted.
“It creates impressions in the market and extreme concern when there is no problem to such a degree for such extreme concern,” Michaelides said.
Nevertheless he added that the issue of price hiking had not gone unnoticed by the government and that following a Cabinet meeting on Wednesday, the issue was on the agenda for discussion at the Finance Ministry this morning.
He said the meeting would assess the situation and clarify the problem so that it could be dealt with responsibly and effectively.
Michaelides said at the meeting he planned to suggest a sit down with producers and importers to talk them into keeping prices logical.
He said an increase in primary materials did not necessarily have to mean an increase in the end product. In fact he said adding on the cost of primary materials on the final price could be equated to profiteering.
Michaelides also said a comparison of the percentage of profit for products of primary need in Cyprus and other European countries would act as a tool to achieve healthy competition for these goods.
“Consumers also hold their own fate in their hands. They should keep their eyes and ears open and purchase goods where the vendor has set logical prices,” the minister said.
Commenting on the situation, Cyprus Chamber of Commerce and Industry (KEVE) president Manthos Mavrommatis said cereal prices had increased around the globe which had undoubtedly affected retail prices.
“KEVE believes the increase of prices is unavoidable but we appeal to suppliers to try to be as constrained as possible in their increases.”
He added: “Cyprus is a very competitive economy which means if someone wants to increase prices the existence of such a competitive environment will make sure unreasonable prices cannot be maintained because it will give an advantage to their competitor to increase their sales.
Butchers Association president Costas Livadiotis told the Cyprus Mail meat prices had not increased as much as was being made out.
“Only pork and chicken prices have gone up,” he said.
Livadiotis blamed international increases on cereal prices for the price hikes.
“More increases are expected. At the moment the pigs are being fed on cheaper feed. Now that cereal prices are going up around the globe it’ll mean that the feed is more expensive,” he said.
He said pork prices had gone up by seven per cent in the past week.
“From 70 cents per kilo of livestock it’s gone up to 75 cents,” he said. He said this increase had been added on to the retail price.
In fact he said pork had been set to go up 15 per cent but that at the last minute it had gone up only seven per cent.
“In two weeks the price is supposed to go up a further eight per cent,” he said.
He said lamb prices still remained low but that could change over the next two or three months.
Livadiotis said butchers had no choice but to put up their prices if they wanted to stay afloat. With livestock and slaughtered meat prices on the up, retail prices also had to go up.
”But it’s not extortionate and meat is still much cheaper for consumers in Cyprus than in England, France and Italy where they buy the meat cheaper to begin with and have larger profits,” he said.
Cyprus Milk Industry Organisation director Andreas Marangos was less forgiving.
He said the milk producers prices were 40 per cent above European prices because of higher costs. With cereal prices, especially corn, on a global increase, producers would have to curb their profits if prices were not to escalate further.
However, the main problem he said was the mark up price that hypermarkets placed on both locally produced and imported dairy products, which in his book was an example of profiteering.
“Someone has to examine this issue and do something. A hypermarket cannot buy milk for 50 cents and then sell it for 65 cents,” he said.
With producers putting up their prices by one cent on June 1, Marangos said he feared milk prices would go up again, unless the industry decided to absorb the price.
He said Cypriot consumers bought effectively bought dairy products for £12-£14 per kilo which was ridiculously overpriced and yet no one ever complained.
“Hypermarkets can mark up the price of milk and know that they will sell it because everyone needs to buy milk. Even if they put the price up to 80 cents people will buy it,” he said. This profit then allowed the hypermarkets to sell other products at giveaway prices, he added.
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