ICSA Beef chair Edmund Graham has said the Government must not allow itself to be manipulated by supermarket interests when it comes to the pricing of key staples like meat, bread, vegetables, and dairy. Mr Graham was responding to yesterday’s (May 10) meeting of the Retail Forum.

Mr Graham added that it was unacceptable to make key farm products the focus for reducing headline inflation. “It is laughable to pretend that a 10c cut in a loaf of bread is going to make a substantial difference to household budgets when there are thousands of product lines on supermarket shelves that continue to be sold at extortionate prices. There is no focus on whether prices for toiletries, condiments, sauces, frozen pizzas, or numerous other items can be justified.” 

“On the other hand, input cost inflation is real and the narrow margins on primary products is a reality that is putting extreme pressure on farmers especially in meat, cereals, and vegetables. I would have some respect for Government if there had been an iota of concern that meat prices did not increase anywhere near the increased cost of fertiliser, feed, and fuel in 2022. ICSA has examples of farmers whose costs went up 33% but who gained about 8% in product price in their dealings with retailers.” 

“This week’s beef prices are about 8% above this time last year and lamb prices this week are exactly the same as in 2022 and 2021. In that context, it is offensive to see Government egging on retailers to cut prices for key farm products as if the farmer price is the main driver of inflation.”

“The reality is that this is a smokescreen to distract from the fact that many imported products in the shopping basket are much more beneficial to supermarkets and consumer spend on these will increase if the supermarkets use their power to drive down prices on basic staples.”

“ICSA has this morning received reports of supermarkets contacting small scale primary producers instructing that they pass on any reduction in their input costs to the retail giants, and that they are obliged to do so. However, they were not facilitated to increase their prices last year in line with the explosion in costs.”

Yesterday the Minister of State with responsibility for retail Neale Richmond said he had received assurances from food retailers that consumers will benefit from reduced prices – but only where input costs have lowered.

“We now know exactly what this means, pressure being piled onto local suppliers to reduce their costs, and then pass on those cost savings to the retailers. To be clear, in the wake of yesterday’s meeting, hugely profitable retailers have decided to wield their power and heap pressure on primary producers and small-scale suppliers so that they can virtue signal about reducing prices for consumers, but still maintain their own profit levels.”

“It is important for consumers to understand just what is going on. Most primary producers are operating with tiny margins and have next to no bargaining powers when it comes to negotiating with the big retailers. They are the ones being hammered in the name of bringing down food prices so that retailers can continue to make massive profits behind a veil of almost total secrecy.”

“To this end, ICSA has long since been arguing for a regulator to forensically investigate who is making what along the food chain and to expose excess profiteering. While we are moving nearer to this becoming a reality progress on the establishment of the office of the AgriFood Regulator has been painfully slow. The time for greater transparency has surely come, and the necessity of a food regulator, with adequate powers, should now be clear for all to see.”

ENDS