The Consumer Watchdog believes that the recent price increases in the large supermarkets are due to higher costs rather than price cuts.
Rod Sims, chairman of the Australian Competition and Consumer Commission, says the watchdog is keeping an eye on the problem as buyers struggle to provide essentials during the coronavirus pandemic.
Mr. Sims said people originally complained that there were no more promotions, but reports of price increases were now being received.
He believes it’s more about the supply chain than the supermarkets themselves.
“Maybe you have a production company that makes something good like pasta or rice, and before that you did it with just one shift,” he said to Seven.
“You could now switch in two or three shifts, and of course that is more expensive.
“This can affect the underlying cost of the offer as they try to increase the offer to meet this panic demand.”
Australian supermarkets have been given permission to work with each other to ensure that their shelves are filled during the outbreak.
However, the temporary rules do not allow supermarkets to agree on retail prices for products.