Portugal: Unbalance between producers and distributors due to concentration in big stores
The Observatory of Agricultural Markets and Imports (OMAIAA) compared the price difference between four agricultural products (carrots, rocha pear, apple and lettuce) regarding payment to farmers and payment by consumer, up until March and concluded that profit margins in the supermarkets are around the 50%.
A situation that, according to Maria Antonia Figueiredo, happens in every European country and should have the attention of the European Commission, which is studying a way to impose more rules on the producer/distributor relation.
"There's a huge inbalance between production and distribution and the European Union is starting to put the question in its agenda. This phenomena exists in every European country because big stores are getting more and more concentrated and that gives them a huge power when it comes to negotiating prices", commented a spokesman for the Observatory.
In the four weeks of March analysed by OMAIAA, the price paid at production saw a slight rise, while prices to consumers went down, affecting the profit margins for distributors that, despite this, are still above 50%.
As for lettuce, the example is even more obvious, as the product is obtained at 0.38Euro at the farm and it's sold at 1.78Euro to consumers, assuring a profit margin of 78%.
Carrots are bought at 0.32Euro and sold at 0.70Euro, allowing a 55% margin, while apples are bought at 0.59Euro from producers and sold at 1.34Euro to consumers (a 56% margin).
Only for the Rocha pear, the profit margin diminishes to 37%, since the fruit is acquired at 0.65Euro and sold to consumers at 1.04Euro.