The Federal Competition and Consumer Protection Commission (FCCPC) has issued a stern warning to market leaders about the skyrocketing prices of essential goods, especially foodstuffs, which have become increasingly unaffordable for the average Nigerian. This warning comes amid concerns over exploitative pricing practices that are eroding consumer purchasing power.
During a one-day stakeholder engagement event held in Uyo, Akwa Ibom’s state capital, FCCPC Chief Executive Officer, Mr. Tunji Bello, revealed how powerful cartels within the poultry and packaging sectors manipulate prices to maintain high profit margins despite government interventions aimed at stabilizing costs.
Bello explained that the poultry industry is dominated by a few large players who set prices, forcing smaller poultry businesses to follow suit. “Small poultry farmers once sold day-old chicks at around N480 to N590 with a decent profit margin. But with two major players now controlling 80 to 90 percent of the market, the price has surged to N1,350,” Bello disclosed. He warned that these big players use their financial muscle to stifle competition and inflate costs, disregarding the traditional economy-of-scale principle, which states that higher production should reduce unit costs.
This engagement in Uyo is part of the FCCPC’s broader, nationwide advocacy campaign aimed at curbing price gouging. Similar sessions have been held across Nigeria, as the commission actively seeks to end exploitative practices in various sectors, including food, beverages, and other consumer goods.
“We’re calling on all stakeholders—consumers, MSMEs, market leaders, farmers, and NGOs—to work with the FCCPC in curbing these unethical pricing practices,” Bello urged.
Bello also highlighted the issue of inflated prices in the beverage sector, which he attributed to a cartel in the packaging industry. According to him, five major players dominate the supply of packaging materials, operating with mafia-like coordination to ensure uniform prices across the board. “Even if a buyer attempts to negotiate with one supplier, they are tipped off by the others to maintain the same price,” he explained, describing the situation as a “price trap.”
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Despite receiving substantial support from the Federal Ministry of Agriculture and Food Security over the past year, poultry prices continue to soar. Starter mash, a key poultry feed, rose from N11,000 in October 2023 to an alarming N23,500 by October 2024, illustrating the severity of the pricing issue.
Bello stated that, in line with the “spirit of democracy,” the FCCPC initially prioritized dialogue over enforcement, even though the FCCP Act allows for severe penalties, including heavy fines and jail terms, for those involved in exploitative practices. However, he hinted at potential enforcement actions if market leaders do not align with consumer interests.
President Bola Tinubu has introduced a range of economic relief measures to help ease the burden on consumers, including the removal of tariffs on food imports, VAT exemptions on pharmaceuticals and medical devices, and tax waivers for businesses. Additionally, easy credit has been made available for vehicle owners converting from petrol to compressed natural gas (CNG).
“It’s only fair that our traders and business community share these gains with consumers in the form of reduced prices,” Bello concluded.
