Retailers raise prices despite MoE warning

Several establishments dealing in basic commodities have increased the prices of their goods ahead of Ramadan this year, despite warnings from the Ministry of Economy (MoE) that they will be fined and their trade licences cancelled.

The MoE's Department of Consumer Protection said it will step up inspection campaigns this week to prevent traders from using Ramadan as an excuse for illegal and unjustified increase in prices.

As reported yesterday in Emirates Business, the MoE conducted inspections in Abu Dhabi markets yesterday and fined several traders who were found to have raised the prices of their wares without authorisation. The raids were led by Dr Hashim Al Nuaimi, Director of the Department of Consumer Protection.

Meanwhile, at Abu Dhabi's Al Mena market, prices of fruits and vegetables have risen sharply two weeks before the start of Ramadan this year, while in the past the prices used to increase just two or three days before the start of the Holy Month.

Mohammed Muhideen, owner of Muhideen Vegetables and Fruits Trade, said retail traders were not responsible for the increase. He said their profits range between Dh1 and Dh2 per kilogramme and put the blame on wholesalers in the Al Mena market who are selling their goods at higher prices. The 150 or so wholesalers are the main beneficiaries of the increase in prices, not the retail traders, he said.

However, Mahmoud Khalil Al Jabour, a wholesale dealer at the Al Mena market and owner of Bilal Vegetables and Fruits Trade, said an increase in the price of some vegetables and fruits was very natural as it was basically related to the increase in prices of the commodities in their countries of origin.

Another reason for the increase, he said, was the unavailability of local produce coupled with a big demand for certain commodities. He admitted some dealers took advantage of "sale seasons", such as Ramadan and Eid Al Fitr, to raise prices in order to compensate for their losses throughout the year.

Al Jabour said there was fierce competition for survival in the market after huge losses incurred in the past years that saw some wholesalers go out of business, and even contended that prices in the UAE were decreasing continuously and the country had the world's cheapest prices for vegetables.

Ahmed Abdulatif, owner of Al Ghadir Vegetables and Fruits Trade, agreed with Al Jabour. He said Ramadan was an opportunity for dealers to gain more profits and prices usually increase in the first three days of Ramadan when there is a heavy demand from consumers. After the first week of Ramadan prices begin to fall gradually, especially for vegetables, while the prices of fruits increase again before Eid as demand goes up, he said.

Dealers would benefit if prices remained low, Abdulatif said, because they would sell in greater quantities and gain more profits. He did not agree that any hoarding of goods took place so that an artificial scarcity could be induced in the market to increase prices and then the hoarded goods sold for greater profits.

Nour Mohammed, a salesman at Al Harmoudi Vegetables and Fruits Trade in the capital's Zayed City market, said due to an on-going increase in prices there were not too many buyers.

Mohammed Azem, Manager of Khanji Brothers Vegetables and Fruits Trade, said: "We are not responsible for the price rise. The wholesalers are charging higher prices for the goods that we can buy only from them and so we cannot refuse, whatever the prices are."

He said he was surprised when a 9kg box of lettuce increased from Dh30 last week to Dh100. "We do not have a logical reason for this big increase," he said.

In Abu Dhabi's main fish market, too, prices have registered an unprecedented increase, which has come as a surprise because fish prices usually fall before Ramadan due to the increasing demand for meat, said traders.

Hasan Muhideen, owner of Hasan Fish Shop, said the increase in the price of fish is related to the low quantities of fish sent to Abu Dhabi by local fishermen and those from Dubai, Ras Al Khaimah or Oman, coupled with an increasing demand from buyers who returned recently from their vacations.

He said profits margins of fish dealers were small and the increase in prices is a natural consequence of rising cost of living.

Meat prices, too, have increased by more than 35 per cent. Dealers at the Al Mena market put the blame on exporting companies. They said their profits do not exceed Dh2 per kg, which is not sufficient to even cover the rents for their shops of about Dh40,000 a year.

In the Abu Dhabi Co-operative Society's Al Mena branch, it was noticeable that many necessary commodities, such as basmati and Egyptian rice, were absent and that the prices of meat and fish have risen by 20 to 30 per cent.

Expressing their resentment, consumers blamed the price increase on unscrupulous dealers who were taking advantage of the Ramadan period to increase the prices.

Najla Rifae, a customer, said she had not seen such increases in the past. This year, the price of some vegetables and fruits doubled within a few days, she said asking the authorities to ensure suitable prices for basic commodities.

The MoE said it has ruled out any increase in prices of basic commodities, which it calls unjustified. Officials from its Department of Consumer Protection said the MoE will intensify inspection campaigns in the country's markets in co-operation with municipalities to prevent price increases.