Alleged Tesco UK demand for suppliers to drop prices ‘a disgrace’

An alleged move by Tesco UK to demand suppliers drop their prices has been described as “disgraceful” by the Irish Cattle and Sheep Farmers’ Association (ICSA).

This follows reports by multinational media outlet Reuters that Tesco has given suppliers until Friday, July 10, to agree price reductions.

This is part of a move to step up a price battle with Aldi and Lidl, an industry source told Reuters.

Commenting on the matter today, Wednesday, July 8, ICSA president Edmond Phelan said:

“Tesco UK is one of our biggest customers for beef, but once again the power wielded by major retail corporations has been exposed for all to see.

Expecting suppliers to cut their prices while they disregard production costs is unconscionable.

“The move is particularly galling as it comes on the back of bumper grocery sales over recent months,” the president claimed.

Phelan also noted that Tesco UK has reported that, while the number of trips made by shoppers fell by nearly one-third in the 13 weeks to May 30, the amount being bought rose by 64%.

“This is a real slap in the face for beef farmers and it clearly demonstrates the necessity of having the major retailers present at the beef taskforce.

Beef farmers cannot produce beef at below the cost of production and expecting farmers to do so is exploiting them, not supporting them. This is the reality that will have to be accepted by all retailers.

“The lack of solidarity being shown by Tesco UK to their suppliers is staggering, particularly as we try to navigate the new normal following Covid-19,” the president said.

“No sector has come out unscathed, but Tesco suppliers have kept going during the pandemic and kept the shelves of Tesco stocked throughout. It is unbelievable to think that this is how they repay them,” Phelan concluded.