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There is no dairy monopoly in Saudi Arabia
Published in The Saudi Gazette on 16 - 10 - 2015

Every now and then, campaigns are initiated with the purpose of jeopardizing local companies. Undoubtedly, every consumer has the right to reject, boycott or object to products that have increased in price. But the problem is when these campaigns label other companies as monopolies, which are greedy or are taking advantage of consumers.
This is totally subjective because no company has the right to monopolize a product. Let us take, for example, a recent campaign that called for boycotting Al-Marai and Al-Safi dairy products because of increased prices. The reason given was that these companies have exclusive control over the dairy market. Firstly, we must define what we mean by monopoly, a word which, according to experts, means merchants withholding food or products from people when these are least available and people mostly need them so that merchants can increase the price and make extra profit. Another definition for monopolizing products is not to sell something when prices are low and only sell when the prices are high and there is a shortage in the market.
According to the definitions, Al-Marai and Al-Safi are not monopolizing because they neither have the right nor the capability to do so. That is because there are plenty of dairy products in the market in our open and free economy. As for the increased prices, consumers must be aware that raising prices is a tough decision in a competitive non-monopolized market. Increasing prices means that consumers will probably find other products and avoid the brand or company that has become more expensive – especially in the absence of justified and genuine reasons for the increase. It is a truly challenging market.
We must realize that these are local Saudi companies that employ thousands of Saudis and add to our national economy. They play an important role in securing food and the Kingdom has granted many dairy and food companies licenses to create an atmosphere of competitiveness and openness. We trust the Ministry of Commerce because it monitors the situation and records violations at times when "pricing agreements" between companies occur. We trust that in cases of violations, there will be direct interference from our government, which has happened before. We must not forget the government intervention in the agriculture sector when prices changed.
The prices of 10 years ago cannot be maintained without government subsidies. The agricultural sector, as far as I know, does not receive subsidies in the way that there are subsidies in the flour, water and electricity sectors. It is for the benefit of our country and economy that food companies continue to flourish. So why do some people insist on distorting the picture despite the availability of different options?


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