Commission has beef with meat supplier ... and raids its premises
THE COMPETITION Commission of South Africa conducted search and seizure operations at Beefmaster in Kimberley yesterday morning as part of an ongoing investigation into the alleged fixing of prices and trading conditions.
According to the commission’s spokesperson, Sipho Ngwema, the operations were conducted simultaneously at 13 premises belonging to seven meat suppliers in three provinces.
“The commission is probing alleged contraventions of the Competition Act by Karan Beef, Sparta Foods, Chalmar Beef, Beefmaster Kimberley, Morgan Beef, Beefcor and Fabvleis t/a Midland Meat,” Ngwema said.
“The companies - operating from Gauteng, the Free State and Northern Cape - are meat suppliers which are also known as feedlots. They purchase weaner calves from farmers in order to bulk feed them in preparation for slaughtering in the production of beef. They also sell beef to wholesale and retail customers.”
According to Ngwema, the meat suppliers are alleged to have entered into an agreement and/or engaged in concerted practices to fix the prices and trading conditions when purchasing weaner calves from farmers.
“They are also alleged to have an agreement to fix the prices at which they sell meat to wholesale and retail customers.
“The meat industry forms an important part of the food sector which is one of the commission’s priority sectors.”
He stated that the commission remained committed in its quest to fight collusion in the food sector as a whole, as higher prices of food affect the most vulnerable and poor households who spend a disproportionately high percentage of their income on food.
“The search and seizure operations are conducted with due regard to the rights of all the affected persons.”
Ngwema stated that the commission obtained search and seizure warrants from the Gauteng High Court in Pretoria; the Northern Cape Division in Kimberley; and the Free State Division in Bloemfontein in terms of section 46 of the Competition Act.
Only the one premises was searched in Kimberley.
Ngwema was unable to state what had been confiscated and whether this had been found to be in contravention of the Competition Commission. “We cannot release information on what we found until the appropriate time,” he said.
Beefmaster yesterday confirmed that it “had received requests to participate in the Competition Commission’s inquiry into the beef industry”.
“As an established and responsible key role-player in the industry, Beefmaster welcomes the process and the opportunity to clarify any issues in the investigation. Beefmaster is committed to full and constructive engagement with the Competition Commission and its investigation process, and believes such engagement is healthy for the industry,” CEO LW van Reenen said in a statement.
“Beefmaster is a privately-owned, vertically-integrated processor of beef-related products located in the Northern Cape Province of South Africa.”
Beefmaster opened its own abattoir in Kimberley in 2003 and, according to the company’s website, has since processed all of its own cattle and lamb, as well as animals from other feedlots.
“The abattoir does not only supply swing beef, but boasts a state-of-the-art boning facility that packages meat for both the wholesale and retail meat industry. In 2005 Beefmaster opened its first retail outlet and now has several retail stores operating in South Africa. Beefmaster has grown into a large enterprise involved in every aspect of the beef and lamb supply, and trading locally and internationally in beef, lamb, and hides.”