Excessive profits on fruit and vegetables fuel inflation

A field survey carried out by a group of University students during the past week indicated that fruit and vegetable sellers are making huge profits on a range of products produced by local farmers, in some cases amounting to 500 per cent over what they pay the farmer at the central vegetable market (pitkalija).

These excessive profits are fuelling inflation and cost of living pressures which in turn have a negative effect on Malta`s competitiveness of Malta, a leading economist told CCT News.

The prices of a range of vegetables and fruits were surveyed by the students in different parts of Malta. Prices charged for the products were then checked out with the Farmers Central Co-operative Society in order to be able to compare the money earned by farmers with what the price sellers charge the consumers. In short, the farmers get the bone while the sellers get the beef.

The students` shopping visits included those to fruit and vegetable shops, hawkers at markets, mobile greengrocers, and the odd one-point hawkers. Prices at fruit and vegetable shops, most of which are air-conditioned, were invariably higher than those charged by individual hawkers.

The best prices for the consumer were obtained at markets such as those at Marsaxlokk, Cospicua and Birkirkara. Real forces of competition can be seen only in the markets where sellers sell their wares shoulder to shoulder. One-point hawkers tend to be less expensive than shops and are also inclined to charge regular clients less.

But prices also vary according to areas. Prices were higher in places like Sliema, Balzan, Valletta and Mosta and parts of Mellieha. Prices in the south were lower.

There are 2,351 full-time farmers in Malta in Gozo. But the number of fruit and vegetable sellers and importers could not be obtained even if CCT contacted the Chamber of Commerce, the GRTU, and Government departments. The officer at the Trade Licensing Unit at Police Headquarters said such information was not readily available and that in any case anyone requiring such information would require to write in a request.

The survey exercise was sparked after it became known that farmers complained that fruit and vegetable sellers were selling strawberry pallets with about 50 or more grams less in each pallet than those bought from the pitkalija. The farmers were concerned that this does not help to improve their market at a time when the rain in the past few days damaged the fruit and they had to put up prices.

Fruit and vegetable prices were negatively affected by weather conditions over the past several months and this resulted in high prices.

Last week`s rain has also ruined or damaged potato waiting to be ploughed.

Excessive profits also seem to be the order of the day on imported products, whether or not there is a levy. In one place a kilo of imported peaches which has a Lm1 levy was marked Lm3 and in another place Lm2.40. One street fruit and vegetable seller priced a kilo of imported grapes at Lm1.20 a kilo. At a shop it was priced Lm1.50 a kilo.

On the other hand the prices of oranges, applies and kiwis have barely moved for over three years. All over the island one can find better quality oranges selling at Lm1 for three kilos. Smaller oranges can be found at Lm1 for four kilos. The price of second rate apples has been Lm1 for three kilos for a long time while fresh imports are priced at around 65c a kilo. Kiwis which up to a decade ago cost their weight in gold are now among the cheapest fruits since they are plentiful.

The survey carried out by the students shows that shopping around can save consumers often reasonable savings. But consumers are invariably skinned considering what the farmers get.