The President of the Competition Council, Ahmed Rahhou, insisted on Thursday in Rabat on the need to relax the risk coverage mechanisms for operators of the national edible oil market in order to improve the competitive functioning of this market. .
“The Council recommends that the instruments which allow operators to better cover the risk concerning fluctuations in raw materials be made more flexible”, indicated Ahmed Rahhou during an interview with MAP, on the occasion of the publication of an opinion on “the examination of compliance with the rules of free and fair competition by producers and importers of edible oils following the increases in selling prices observed on the national market”.
These rules are established by the Foreign Exchange Office, he recalled, recommending more flexibility in the use of these financial instruments able to cover price fluctuations.
He also called for an increase in national storage capacities to lower the cost of raw materials and, in turn, reduce the final selling price of edible oil.
“We consider that a one-month stock can present a risk, because if, at some point, an oil transport boat does not arrive, there is a risk of being out of stock” he points out to this effect.
The Council also recommends supporting the upstream side of the sector relating to the local production of oil seeds to produce oils. “We encourage the public authorities to continue the effort to support this sector, especially now, given the price level,” said Ahmed Rahhou.
He also observed that the number of operators in this sector is “limited”, specifying that it “is not attractive”. “The margins in this sector as well as the amounts of investment required, in addition to all the logistics, are relatively significant,” he explained.
Moreover, throughout the world, there are not many players in this type of sector in general, he argued.
He also highlighted the explanatory factors for the increases in the selling prices of table oil observed on the national market, noting that these are explained by the conjunction of objective factors linked to the structure of the market itself. and to developments in the external market on which it is dependent.
In particular, this is a highly concentrated and unattractive market where imports of crude oils are concentrated in three regions.
Regarding factors related to the external market, Ahmed Rahhou referred to the rise in world prices of crude oils and the costs of raw materials, aggravated by the concomitant increase in the price of energy and transport.
The Council, he said, analyzed the timing of these increases and their consequences on the market. “We found a direct correlation, that is to say, that increases abroad are passed on to the consumer,” he said.
.