Essentials: prices for eggs and butter may fall by 5%
Prices for chicken eggs and butter may soon fall after these products are included in the list of socially important goods for which producers do not have to pay remuneration to retailers. This was told to "Izvestia" by business representatives and experts. The size of bonuses was up to 5%. The government believes that the savings will allow to expand production. The FAS said that they will ensure control over compliance with the ban by retailers.
Ban on payments to retailers of bonuses from manufacturers
February 1, Prime Minister Mikhail Mishustin signed a decree expanding the list of socially important food products, for the purchase of which manufacturers should not pay remuneration to retailers. According to the document, they included eggs of the first and second categories and butter with a mass fat content of 72.5%. Experts interviewed by Izvestia believe that this will help to reduce prices by the size of the bonus - up to 5%.
"According to the law on trade, suppliers pay bonuses to retailers for the fact that networks purchase a certain amount of goods from them. Inclusion of oil and eggs in the list of socially important goods, in respect of which the payment of remuneration is not allowed, will allow to exclude such a practice," - so explained the decision in the press service of the Cabinet.
It also noted that the ban on remuneration will give producers the opportunity to reduce costs when supplying products to retail chains and direct the freed financial resources for modernization and expansion of production.
"Ultimately, the proposed measure may contribute to the reduction of wholesale prices of producers for consumers, including as a result of increased production of products," the Cabinet emphasized.
According to the results of 2024, butter increased in price by 36.2%. The situation was brought to the attention of the State Duma, where it was proposed to introduce state regulation of prices for this product, and the Prosecutor General's Office, which began its investigation into pricing. The FAS and the Ministry of Agriculture also took control of the price rise. The antimonopoly body has started inspections of producing companies, while the Ministry has expanded the supply of goods from other countries, as well as announced the beginning of work to increase the production of domestic raw milk.
Egg prices in 2024, on the other hand, fell by 11.16%. A rapid increase in the cost of this commodity occurred in 2023 - by 61.35%. However, over the past year, their cost has not returned to the initial price.
As "Izvestia" was informed in the FAS, this resolution was developed by the antimonopoly authority, which has recently regularly recorded an increase in the prices of these goods.
- These products are most demanded by retailers, consumers, as well as small and medium-sized businesses, which, for example, include bakeries and confectionery shops. The introduced ban will reduce the costs of producers when supplying products to retail organizations, - explained in the press service of the antimonopoly authority.
They also noted that it will give an opportunity to direct the saved funds for modernization and expansion of egg and butter production, which will increase the volume of supply of the corresponding products in the domestic market.
- This will contribute to lower prices for end consumers. FAS of Russia will ensure control over the compliance of retail chains with the established ban, - emphasized the antimonopoly authority.
Will the trade fulfill the new requirements to refuse bonuses?
According to business and experts, the price of eggs and butter may fall by the amount of bonuses - 5%, which were paid to the trade.
- Naturally, this will affect the reduction of prices, for the sake of which the government decree was adopted. We raised the issue of abolishing the bonuses a long time ago, but it has been resolved only now. Therefore, this is a positive decision for us," Galina Bobyleva, Director General of the Russian Poultry Union (Rosptitsesoyuz) explained to Izvestia.
According to her, another thing is how the trade will behave, whether it will increase its markup on these goods after that, having lost bonuses of producers.
The inclusion of butter and eggs in the list of socially important goods and the ban on charging bonuses when supplying them to chains are aimed at increasing the transparency of the commodity chain, Dmitry Leonov, deputy chairman of the board of Rusprodsoyuz association, told Izvestia.
- In order to pay 5% of the remuneration, the producer needs to take it into account in the selling price. However, it does not always affect the cost of goods on the shelf. Trade networks set the markup at their discretion. Therefore, when prohibiting remuneration of 5%, the network can demand a corresponding reduction in the cost of shipment of goods from the supplier," he explained to Izvestia.
According to him, the cost for the buyer can be reduced only if the retail markup does not increase. Earlier Rusprodsoyuz reported that for butter it reaches 70%. Thus, the retailer earned twice. First on the producers, who paid him bonuses, and then on the customers due to the high markup.
- This is a reasonable decision on the part of the government in the context of rising costs of food production. Despite the fact that it does not directly affect the price of goods, it can contribute to the overall reduction of the burden on the supplier, - said the general director of "Soyuzmolok" Artem Belov.
Igor Karavaev, Chairman of the Presidium of the Association of Retail Trade Companies (ACORT), explained to Izvestia that financing producers at the expense of trade will make it difficult for retailers to maintain minimum markups on a wide range of everyday goods. This measure does not provide for any tools of control and responsibility of manufacturers for pricing policy after receiving preferences, so it may not lead to a reduction in selling prices for the goods covered by the relaxation, said Igor Karavaev.
Retail, which annually shows profit growth, will comply with the government's decision, says Georgy Ostapkovich, Director of the Center for Conjunctural Studies of the Institute of Economic Research of the National Research University Higher School of Economics. According to him, prices may fall by up to 5% of the markup, but the trade will find a way to compensate for it. For example, the price of goods that are not socially important may go up, the expert believes.
- According to the law on trade, remuneration to retail cannot exceed more than 5% of the price of the volume of goods supplied under a particular contract. However, these percentages are not mandatory and can be different in size: somewhere 5% and somewhere 2%. Therefore, we understand that we are not talking about a large sum," Ilya Bereznyuk, Managing Partner of Agro and Food Communications, explained to Izvestia.
According to him, in the short term it can be assumed that exactly by these percentages there will be no price increase in the near future. The end consumer may not feel the effect of the measure taken by the government, but the manufacturer will have the opportunity to invest this money in other channels of development, and in parallel it also affects the price containment, summarized the expert.
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