Annual price negotiations between grocery stores chains in Norway and food producers and wholesalers were underway this week, and raising more concerns. Dominant NorgesGruppen, which is both a retailer and wholesaler, also negotiated on behalf of the troubled ICA and Rimi grocery chains, giving them even more market power.
NorgesGruppen, which owns the Meny, Centra, Ultra, Spar and Kiwi chains among others, entered into a disputed purchasing agreement with ICA and Rimi earlier this year that competition authorities believe is illegal. The pact is still up for review but NorgesGruppen is representing ICA and Rimi anyway, reported newspapers Aftenposten and Dagens Næringsliv (DN).
“We are negotiating (with, among others, food producer Orkla) primarily on behalf of NorgesGruppen for 2014, not ICA,” Per Roskifte of NorgesGruppen told Aftenposten. “But in the meetings we’re having, we make it clear that a possible cooperation with ICA is in the works.”
The meetings are important because they generally set the prices that the retail grocery chains will pay to producers and suppliers like Orkla. Ole Robert Reitan of the rival grocery store chain REMA 1000 firmly opposes the pending pact between NorgesGruppen and ICA, calling the current negotiations “a sign of disrespect for the authorities.”
Others claim that if ICA, which reported more losses this week, goes out of business in Norway, NorgesGruppen will have even more control over the market. Norway’s high consumer prices are a product of such market dominance along with a closely controlled wholesaling network, heavily regulated agricultural production and protectionist farming policies that keep cheaper imports out of the market.
newsinenglish.no staff
