The Competition Tribunal hearing into whether Pioneer Foods was a member of a national bread cartel continued on Friday, with the Competition Commission wrapping up its case.
The emphasis of the testimony by the commission’s witnesses shifted from the Western Cape bread market to the inland region.
The commission’s final two witnesses detailed meetings that allegedly occurred between staffers from the major bakeries, where price increases were agreed, as well as the dates of implementation.
Pioneer Foods is attempting to clear its name on charges of collusion being faced by its bread businesses, Sasko and Duens.
While Pioneer’s alleged fellow colluders, Albany (Tiger Brands), Blue Ribbon (Premier Foods) and Sunbake Bakeries (Foodcorp), have all admitted guilt and settled with the Competition Commission, Pioneer is taking the commission on, claiming it was not part of the cartel.
Its defence strategy so far has revolved around attempts to discredit the commission’s witnesses.
The commission’s first witness on Friday was Blue Ribbon’s customer service manager for the inland region, Willem van der Linde, who testified about telephonic conversations he had with Sasko’s Aeroton Bakery general manager, Johan Oosthuizen, in November 2006.
Van der Linde testified that he had called Oosthuizen to find out if Sasko was planning a price increase, because Blue Ribbon was then considering one.
Oosthuizen allegedly confirmed the price increase that Sasko was planning and offered to speak to their other competitors.
“He contacted me approximately two days later and indicated that Sasko, Albany and Sunbake were also going to increase their prices by 30 cents on December 18 2006,” said Van der Linde’s witness statement.
Van der Linde testified that the bakeries regularly discussed when price increases would be implemented as part of what he called a “culture of cooperation”.
“We didn’t want to all go at once so we made it look like it was spread over a period,” said Van der Linde. “We didn’t want to be seen as price leaders.
“You would lose volumes if you went first, but if it moves around you would make back the volumes further down the line,” he added.
The commission’s final witness was Blue Ribbon’s Potchefstroom depot site manager, Elmare Pieterse, who testified about a meeting she arranged with staffers from the other bakeries.
Pieterse testified that Sasko Krugersdorp sales manager Elize van Dyk, Sasko Krugersdorp bakery manager Michael Florence and Sasko Klerksdorp depot manager Gideon Oosthuizen were all at the meeting, where price increases were discussed.
Pieterse said that price-increase amounts and dates of implementation were agreed upon at the meeting.
“Blue Ribbon would go first and the rest would follow within the week,” said Pieterse.
She added that the bakeries’ representatives also entered into a “gentleman’s agreement” at the meeting not to poach each other’s customers during the period of the increases.
Following Pieterse’s testimony, Pioneer called its first witness, Sasko managing director Andries Goosen, who testified that he made all decisions about price increases for Sasko and that he had never held any meetings or discussions with any of his competitors’ employees over price increases or their implementation.
“No not at all, there were no agreements and no understandings,” said Goosen. “They were unilateral price increases.”
The rest of the day’s testimony involved Pioneer’s advocate, John Newdigate, running through a litany of meeting minutes, strategy documents, emails and letters with Goosen to illustrate that all pricing decisions were taken independently.
The hearing will continue on Monday with the commission’s cross-examination of Goosen.