The Egyptian government detects 4 egg brokers who have entered into a cartel agreement since 2020 causing a colossal price increase

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CAIRO – July 31, 2022: The Egyptian government has detected four prominent egg brokers for maintaining a horizontal cartel arrangement since October 2020, causing a colossal spike in the price of eggs, a main course on Egyptian tables.

Over the past few months, Egyptians have grappled with soaring commodity prices amid disruption to global supply chains due to the crisis in Ukraine.

Egg prices, however, continued to climb beyond expectations by more than 30% in recent weeks before starting to fall again this week.

In a statement, the Egyptian Competition Authority (ECA) said the four brokers violated Article Six of Law 5/2003 on the Protection of Competition and Prevention of Monopolistic Practices by agreeing on the market price of eggs.

The examination and investigation procedures proved that the aforementioned brokers agreed and coordinated on a daily basis to unify the price trends from October 2020 to July 2022, the ECA said.

In accordance with their agreement, egg price trends reached the point of full compliance at certain periods, the ECA noted.

According to this activity, egg prices have soared in a way that weighs on Egyptian citizens given that eggs are a main course throughout the year, the ECA added.

The authority warned that the crime of horizontal cartel agreement is one of the most serious competition crimes.

This crime leads to the disruption of the free market mechanisms of supply and demand as each economic entity is supposed to make its decisions individually without being affected by other entities in accordance with the principles of free market economy, added the ECA.

People who commit this type of crime seek to disrupt competition among themselves to ensure that profit margins are made at the expense of the citizen, the ECA said, explaining that citizens should benefit from the presence of competition to obtain the best goods at the lowest prices.

For his part, ECA Chairman Mahmoud Momtaz confirmed that the authority closely monitors and performs real-time monitoring of the market of different types of eggs to deal with any monopolistic practices that may harm citizens.


Control prices in times of crisis

In June, Egyptian President Abdel-Fattah El-Sisi asserted that the state is making maximum efforts to control rising prices due to the global crisis in Ukraine.

El-Sisi said that the development projects the country has been implementing have prevented a possibility of higher price increases over the past six months.

In remarks to the press following the inauguration of an integrated animal and dairy production complex in the governorate of Menoufiya, Sissi affirmed that the state is able to control the prices of basic products until the end of the year in the context of the current crisis.

He added that the state has reserves of strategic products that can cover the needs of citizens for the next six months, including wheat thanks to the local quantities provided by farmers during this season.

The government earlier decided to postpone the planned electricity price hike for households to ease the burden people are bearing amid the crisis, especially low-income citizens.


Continue to subsidize bread

Earlier this month, Supply and Internal Trade Minister Ali Moselhi said the government would continue to subsidize bread at diesel-powered bakeries amid rising fuel prices.

This comes as the Egyptian government has set LE 90 billion in the budget for the new fiscal year 2022/23 for food and bread subsidies.

Egypt raised fuel prices starting this month by up to 0.5 LE, the country’s biggest fuel price hike in years.

Egyptian Prime Minister Mostafa Madbouli has affirmed Egypt’s willingness to continue subsidizing the bread system despite the mad spike in world wheat prices.

He claimed that the government still sells bread at 5 piastres while it currently costs the state 80 piastres, noting that citizens consume 100 billion loaves a year and 270 million loaves a day.

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