Learn Spanish (Latin America): Hay productos peores en este mercado.

Peor means "worse." Even though it is a special comparative word, it is still an adjective and must match the noun it describes in number. Since productos is plural, you add -es to make peor plural, giving us peores.

Where is the word for "more" (más) in this comparison?

You don't need it! Just like we say "worse" in English instead of "more bad," Spanish uses the irregular word peor. Because peor already has the comparison built into it, you never use más with it.

Why is it este mercado and not esto mercado?

Mercado is a masculine singular noun. The word for "this" that matches a masculine singular noun is always este. Esto is a neutral word used for abstract ideas or unknown objects, and it is never placed directly in front of a noun.

Since we are talking about multiple products, shouldn't hay be plural?

No, hay is a special, unchangeable verb form. It translates to both "there is" and "there are." It stays exactly the same whether you are talking about one product or many productos.