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Supermarket price hikes due to increased production, not gouging: watchdog


The consumer watchdog believes recent price hikes at the major supermarkets come down to increased costs rather than price gouging.

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Australian Competition and Consumer Commission chair Rod Sims says the watchdog is keeping an eye on the problem as shoppers scramble to stock up on essentials during the coronavirus pandemic.

Sims said people were originally complaining about promotions no longer occurring but reports were now coming in of price rises.

He believes it’s a supply chain issue rather than the supermarkets themselves.

“You might have a manufacturing company, manufacturing some good like pasta or rice, and previously they did it with just one shift,” he told Seven.

“They might now be moving to two or three shifts and that’s of course more expensive.

“That can affect the underlying cost of supply as they’re trying to boost supply to meet this panic demand.”

Australia’s supermarkets have been granted permission to work with each other to ensure their shelves are stocked during the outbreak.

However, the temporary rules do not allow supermarkets to agree on retail prices for products.


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