CCP Takes Notice of Possible Price Manipulation in Hatchery Sector

Taking notice of the extraordinary increase in the prices of Day-Old Chick (DOC), the Competition Commission of Pakistan (CCP) has advised hatcheries not to resort to any anti-competitive conduct prohibited under the Competition Act 2010. DOC producers have also been asked to let the DOC prices be determined by market forces based on demand and supply mechanisms. Hatcheries are further directed to submit comprehensive records of daily Day-Old Chick (DOC) prices spanning the past few months, including the current month. This action follows numerous complaints regarding alleged price manipulation and possible collusion in the sale of DOCs. Reports indicate an extraordinary 250 percent increase in DOC prices, with rates soaring to Rs. 220 per chick compared to the average cost of Rs. 50-60 per chick. The CCP is analyzing whether this abrupt and disproportionate price surge, occurring without any notable shift in market dynamics, is due to any anti-competitive behavior by DOC producers. It is noteworthy that in majority of the complaints it is highlighted that DOCs are not included in the essential commodities list maintained by respective provincial livestock ministries, leaving their pricing entirely in the hands of suppliers. In contrast, broiler chicken, classified as an essential commodity, has its prices regulated by the District Government. This highlights the urgent need for greater transparency and accountability in this critical segment of the poultry sector. The CCP has already taken steps to address similar issues. In December 2021, the Commission conducted a comprehensive inquiry in the poultry sector, revealing that eight DOC-producing companies, collectively holding over 50 percent market share, were allegedly involved in price fixing and cartelization. Show Cause Notices were issued, and hearings are taking place with the parties involved.