The German government is investigating allegations of years of price fixing on the market of potatoes and onions. The Bundeskartellamt has already performed a house search at nine businesses, while five other companies are also under investigation. Damages for consumers could surpass a billion euro.
Fraud damaging farmers and consumers?
The government service suspects that a central person called several suppliers of onions and potatoes when making big orders for supermarkets, to agree upon a price, from which only slight deviations were possible. In 80 to 90 percent of the time the system is said to have worked. According to German press releases retailers could multiply their profits tenfold.
According to newspaper Süddeutschen Zeitung companies could have earned up to 100 million euro extra in ten years from working this way. Competitor Bild Zeitung mentions fraud worth a billion dollar over ten years’ time. The practice was not limited to onions and potatoes ready for consumption, but was also used for seed potatoes. This way also farmers got lifted.
There are however also some observers who have doubts: the prices for potatoes in German stores are situated in the lower or the middle parts of the European spectrum. Consuming 60 kg per person each year, Germans are quite the potato eaters.