The Coordinator of Organizations of Agricultural Producers and Cattle Ranchers (COAG) is going to ask the Food Information and Control Agency (AICA) to open an urgent investigation to determine whether there is a pact between the main commercial operators to illegally push down watermelon prices at origin.
The 74% drop recorded this past month, (from 0.31 €/kg to 0.08 €/kg), has caused prices to fall below the production costs (0.18 €/kg on average). If this trend continues, 30% of the production could be left unharvested. "It is inexplicable that watermelon prices are falling coinciding with the arrival of heat and the rise in the demand. In fact, the production is somewhat lower in the main producing areas, like Murcia and Alicante, given the lower than expected availability of water for irrigation. It is clear that the fundamental laws of supply and demand are not functioning properly and we want to know why to prevent a ruinous situation for the producers this campaign," said Andrés Góngora, head of the fruit and vegetable sector at COAG.
COAG argues that producers are tired of the use of summer fruits as a bait to attract consumers to large retailers. The drop in watermelon prices is dragging down those of other summer fruits (melons, peaches, nectarines, plums, etc.), reducing the profitability of the farms during the rest of the campaign. In the case of melons, there is already a clear downward trend, with prices going from 0.40 €/kg in week 26 to 0.25 €/kg in the week of 11 July.
To reactivate the market, COAG is urging the Fruit and Vegetable Producers Organizations (OPFH) to resort to the crisis management mechanisms foreseen in the Common Market Organisation (CMO) for fruits and vegetables, including the withdrawal of products for their free distribution in soup kitchens, or for livestock feeding. "There is no point in having the withdrawal prices increased if the OPFH doesn't use them. If the crisis management mechanism is used in a disorderly manner, or is not used at all, as has been the case so far, it doesn't have the desired effect, which is to reduce the marketed volume in a timely manner and ensure prices remain at profitable levels. To this end, it is necessary to encourage coordinated action through the AOP (OPFH associations)," said Góngora. The organization reminded the OPFH that they can have access to up to a third of their operational funds to apply this mechanism.