The national competition authority has announced an investigation into Benna’s decision to increase the price of milk by an average of 9c across the board.
The Office for Competition, a body within the Malta Competition and Consumer Affairs Authority (MCCAA), said it held a meeting with Malta Dairy Products last year following the first indications in the media of potential increases in their milk products.
During this meeting, the Office informed Malta Dairy Products that, should it increase its prices, it will be requesting details of how the price increase was established.
It will now be initiating an investigation to examine whether the actual increase on the price of milk is a result of an abuse from a dominant position in breach of the Competition Act.
“The Competition Office wishes to clarify that in a competitive market, Malta Dairy Products is free to establish the pricing of its products,” it said in a statement. “Having said this, the Office considers the Benna fresh milk product range may hold a strong market position. In such a scenario, any price increase cannot be excessive to the detriment of consumers.”
Benna said yesterday that the change in price is needed to sustain the livelihood of dairy farmers, which will allow them to grow more forage on 39.3% of arable land in Malta and 68.8% of arable land in Gozo.
“[This] ensures that the best quality product continues to reach the consumer,” they said.
“[Benna] is confident that customers will understand the importance of sustaining the local dairy and agricultural sectors,” they said.
The price adjustment is limited to the general rise in food prices as according to Eurostat. Prior to the increase, Benna did not change its prices for seven consecutive years.