The Competition Commission has published the final terms of reference for the Fresh Produce Market Inquiry (FPMI), which is aimed at assessing whether there are any features in the fresh produce value chain that impede, restrict or distort competition in the market.

The market inquiry will focus on particular issues at each layer of the value chain. The scope of the inquiry will cover aspects from the sale of fresh produce by the farmer to the customer and will include the retail, processing and export layers.

The commission has identified three themes that cover the entire fresh produce value chain.

The first theme is the efficiency of the value chain, with an emphasis on the dynamics around fresh produce market facilities. This theme stems from concerns that the value chain, particularly at the level of the fresh produce market facilities, is inefficient and uncompetitive. A specific focus will be around the competition dynamics prevalent at these facilities and other contracting means, such as direct contracting by processors, wholesalers and retailers, which affect competitive dynamics.

The second theme is the market dynamics of key inputs and its impact on producers. Specific aspects relating to key inputs, such as seeds, fertiliser and agrochemicals, that will be considered under this theme are concentration levels, price discrimination, buyer power and exclusivity. This theme is focused on the upper end of the production value chain.

The last theme is barriers to entry, expansion and participation. Special consideration will be given to the barriers faced by small, medium-sized and microenterprises and firms owned or controlled by historically disadvantaged persons. In this regard, and where required, this may include consideration of specific pieces of legislation and the work of other regulatory or governmental bodies within the scope of the inquiry.

The commission reports that the FPMI will be chaired by Deputy Commissioner Hardin Ratshisusu.