Ok, instead of replying and rebutting everything that was said, let me try to explain this as simple as I can.

1) Take a finite resource. A scarce resource. For this example, I will use corn fields. I could have also gone with oil(fields) or some type of metal or farmland in general or street corners or anything else that is finite. But I'll go with corn fields for this example.

2) In order to keep this simple, let's say that the entire planet holds a maximum of 1000 equally sized corn fields, all of them owned by individual farmers. These farmers are competing with each other in order to sell their corn.

3) At some point, a couple of things will happen.

Some farmers will realize that cooperating with their neighbors gives them an advantage over all other farmers. They can - for instance - share tractors and other equipment, hence lowering the production cost per square mile. This will enable them to sell their product cheaper than the competition can. Hence, they decide to merge their farms/corn fields.

Other farmers will probably innovate in some other way. This will enable them to lower production costs, which will help them out-compete their neighbors. At some point, the neighbors just can't compete anymore, and they will go out of business. The innovating farmers will have made a lot of money though, so if they're smart - and they are - they will buy up their neighbor's land.

Either way, after a while, every farm will have to merge in order to remain able to compete with all the others. Hence, after a while, the initial 1000 corn fields will have merged into 500 bigger corn fields.

4) Because scaling up will always enable the farmers to out-compete the competition, step three will repeat itself over and over again. Until, at some point, there will be only a handful of huge multinationals holding all of the corn fields in the world.

This is not necessarily a problem yet, I think, but...

5) At this point, the multinationals would be foolish to compete against each other. People need corn, so they could just collude and ask whatever they please instead. They could fix the prices into oblivion, and there would be nothing anyone could do about that. Nobody can start a new farm to undercut the prices, provide better service, or innovate in any way, because all of the corn fields are already taken.

The multinationals could even merge into one even bigger multinational, but like I said,  it doesn't really matter at this point. Monopoly or cartel; same difference.

Now, you could argue: "People could switch to grain, hence there would still be competition between the corn multinational(s) and the grain multinational(s)." That would obviously be a false argument, because the corn multinational(s) and the grain multinational(s) could collude with each other just as well, or even merge to form an even bigger bigger multinational.

Bottomline: when scarcity is an issue, an unregulated free market will inevitably lead to a lack of competition, and thus price fixing.