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Business watchdog smells cartel in chili distribution
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Various kinds of chilies. If he had to pick one favorite ingredient for his cooking, renowned chef Jamie Oliver admits that he would pick chili. (Shutterstock/File)
T
he Business Competition Supervisory Commission (KPPU) is investigating suspected cartel practices in chili distribution, blamed for uncontrollable prices of the commodity, KPPU chair Syarkawi Rauff has said.
“We find that in many wholesale markets in Jakarta and its neighboring cities that chili sales are only controlled by three traders, [who dominate large amounts of chili],” he said, as reported by kompas.com on Monday.
The price of red chili – particularly bird's-eye chili – had increased to Rp 150,000 (US$11.1) in a number of markets although the prices at the farmer level were under Rp 50,000, said Syarkawi.
(Read also:Meager market intervention fails to lower chili price)
“This means that the traders' margin is too high,” he said, adding that the KPPU team had investigated the chili trading mechanism in a number of wholesale markets in Jakarta, Bogor and Bekasi.
The business watchdog has also found that the large traders had prevented chili from immediately entering the market to try to increase the price.
He said the large traders were those who had bought chili from collectors, who themselves bought from farmers, and then sold the commodity to market agents and traders.
“We have found enough initial evidence on the suspected cartel to continue with further investigations,” he added. (bbn)
