President of the Irish Farmers' Association Eddie Downey has warned retailers against discounting of fresh produce in the run-up to Christmas.
“The use of below-cost selling of farm produce as a tool to drive footfall undermines Irish production and the financial viability of specialist growers," Downey said, at the launch of the IFA's 'Christmas For Growers' campaign on a farm in North Dublin.
"These growers have invested hugely in their farm businesses to supply a plentiful crop of fresh Irish produce for Christmas. Retailers have to respect this investment.
"Pricing decisions will be made this week by the retailers for the run-in to Christmas, which is six weeks away. In 2013, some items were sold at one tenth of their production cost. This action had the consequence of decimating grower incomes and sending a misleading message to consumers regarding the inherent value of what is healthy food."
Downey noted that fresh produce that is in season such as Brussels sprouts, carrots, parsnips and cauliflower cost as much as 70 cent per unit to produce.
"When they are promoted as low as 49 cent, they are clearly below cost and consumers should be aware that margins on other products in the same shop are jacked up to take more money from them," he continued.
Downey also called upon the Competition and Consumer Protection Commission to monitor the activities of the retailers. “This Commission is very quick to wave its flawed legislation at farmers, who are after all price takers. However, farmers would question how a small number of powerful retailers can arrive at the same price point and it doesn’t trigger any interest from the Commission.
“Growers are fed up with the quality product from their investment and hard work becoming a weapon in the war of attrition between the major multiples. The fresh produce sector is in ongoing decline and we will not allow the industry to be decimated by crude price-cutting tactics, which give the illusion of value to the consumer. Supermarkets are quick to use local individual growers for promotion, but that belies the real situation."
© 2015 - Checkout Magazine by Niall Swan
