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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] South Korea’s Fair Trade Commission (FTC) has imposed corrective orders and fines totaling KRW 2.239 billion on seven ready-mixed concrete manufacturers in the Gwangyang region for colluding to fix prices and control supply, authorities said.
According to the FTC, the seven companies agreed between May 2021 and September 2023 to refrain from price competition, jointly raising prices and coordinating supply volumes. As raw material and auxiliary material costs increased during the period, the companies allegedly agreed to apply fixed discount rates—such as 75% or 86% of benchmark prices—to customers in the Gwangyang area, effectively standardizing sales prices.
The FTC said the firms held irregular meetings to share industry information and repeatedly agreed on new discount rates whenever input costs rose. Over the two-year period, the companies jointly raised prices for private-sector customers on three occasions, increasing the price per cubic meter to KRW 72,400 in June 2021, KRW 86,100 in April 2022, and KRW 91,200 in January 2023.
Investigators also found that when construction companies resisted the price hikes, the concrete producers threatened to suspend plant operations unless the proposed prices were accepted. As a result, price competition disappeared from the local market, leaving construction firms with little choice but to purchase concrete at the collusive prices, the FTC said.
In addition to price fixing, the companies were found to have coordinated supply volumes, sharing sales data and agreeing on allocation rules such as giving priority supply to nearby producers. Firms that exceeded their pre-agreed sales quotas were reportedly barred from signing new or additional contracts.
The FTC concluded that these practices reinforced the collusive structure within the Gwangyang ready-mixed concrete market, significantly undermining fair competition.
AlphaBIZ Paul Lee(hoondork1977@alphabiz.co.kr)
