Last week Friday, we told you how Jose Trejo, the Controller of Supplies at the Belize Bureau of Standards, explained why you, the consumer of cooking gas, have to pay the local butane companies an extra mark-up.
As of December 11th, 2020, they purchase it from the National Gas Company for $65 dollars and 92 cents per hundred pounds cylinder tanks.
Again, as of December 11th, 2020, the local gas companies then sell it to you at $103 per 100-pound tank, if you're in the urban parts of the country. That means that the local retailer makes 37 dollars and 7 cents profit.
This is a regulated price, which means that the Government has the final say on what you, the customer, should pay the local retailers as a fair rate of return.
Well, Jose Trejo contacted us minutes before our FRIDAY'S newscast was about to conclude. He said that there is a bit of fine print to the pricing equation, which he forgot to mention in our interview from last Friday.
Trejo said, quote, "The price regime is fixed... The margins for both Urban and Rural, by design, were meant to allow for independent operators to compete alongside the previous importers of LPG. Not doing this would give an advantage to the previous importers, to squeeze out the independent Belizean operators, since they have significant storage capacity and much more depth in the distribution of LPG in the market."
Insiders in the industry tell us that they have seen the emergence of new Belizean butane companies who have stepped up to challenge the dominance of the Central American companies. The strict regulation of the industry's supply chain did away with the predatory market practices that impacted both you the consumer, and the home-grown butane companies.
