Many people, understandably, have been complaining about the high prices they are paying for fruit and vegetables. Prices have remained consistently high in the last couple of months, with the consumers’ association attacking wholesalers and supermarkets of making big profits at the expense of producers and consumers.

The association backed its claims by citing the alleged price mark-ups on several products. It claimed that local bananas were being sold with a 171 per cent mark-up, cherry tomatoes with a 120 per cent mark-up and carrots with 97 per cent. This might have always been the mark-up on these products, but because prices were lower nobody complained or accused the supermarkets of making big profits.

The president of the consumers’ association Marios Drousiotis told the Cyprus Mail that supermarkets, at present, were making “unjustified profits” as they had increased their margins without paying higher prices for produce. His claim was not substantiated, while it completely ignored the forces of supply and demand, which usually determine prices products in a market economy.

High prices for farm products are a consequence of weather conditions which have reduced the supply, and not the result of some conspiracy by supermarkets seeking bigger profit margins on cucumbers and tomatoes. Extremely high temperatures are damaging crops, while reduced supply of water, combined with a higher cost, is also having an effect on farm output. Is it some conspiracy that one of the most popular summer fruits – watermelon – is selling at almost double the price of last year? Watermelons require big quantities of water and production has been affected by the water shortage, which is why it is selling for more than a euro per kilo.

It is the reduced supply of farm produce that has caused the steep rise in prices and there is very little anyone can do about it. The consumers association seems to be unaware of how a market economy operates, offering a simplistic explanation for the high prices – greedy wholesalers and supermarkets looking to boost profits – which serves its anti-business agenda. If the association would, it would have demanded the intervention of the state and the imposition of ceiling prices in order to protect consumers. This will not happen because setting maximum prices never has the desire effect, usually causing shortages.

We should accept that conditions outside our control often lead to price rises. This year’s weather conditions have caused the fall in supply that has pushed up prices and not an arbitrary decision by supermarkets and wholesalers to increase profit margins. Admittedly, nobody likes paying close to a €4 per kilo for tomatoes, but this is how a market operates, and, unfortunately, it is not a problem that can be fixed by government decree, as the consumers’ association seems to suggest.