Karachi dairy associations fined for price-fixing and inflating milk prices.
The Competition Commission of Pakistan (CCP) has imposed fines on three dairy associations in Karachi for their involvement in artificially increasing the prices of fresh milk.
According to the CCP, a bench consisting of Chairman Dr. Akbar Sidhu and Member Abdul Rashid Sheikh imposed fines on the Dairy and Cattle Farmers Association (DCFA) for Rs1 million, while the Dairy Farmers Association Karachi (DFAK) and Karachi Dairy Farmers Association (KDF) were fined Rs500,000 each.
The action was taken following investigations triggered by media reports highlighting a significant rise in milk prices across Karachi. The inquiry revealed that the three associations were directly responsible for raising milk prices in Karachi and its surrounding areas.
The associations argued that the prices set by the Karachi Commissioner under the Sindh Essential Commodities Price Control and Prevention of Profiteering and Hoarding Act, 2005, had not been revised in three years despite rising inflation.
However, the Commission’s investigation found that the associations had intentionally manipulated the milk supply chain, creating undue pressure and obstacles to inflate prices.
Evidence presented during the investigation, including video recordings, confirmed that the associations’ declared prices were enforced throughout the supply chain. Wholesale suppliers and retailers were threatened with supply cuts unless they adhered to the newly imposed rates.
The ruling also revealed that the associations influenced critical pricing factors such as market rates, wholesale, and retail prices, leading to market disruption. Furthermore, they created an artificial milk shortage by storing milk in ice factories and selling it at inflated prices in interior Sindh. These tactics severely impacted the supply chain and imposed additional financial burdens on consumers.
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