Competition watchdog pours cold water on Power call for beef sector investigation

The Competition and Consumer Protection Commission (CCPC) has decided not to comment on the proposals of a new beef sector report – authorised by the Irish Farmers’ Association (IFA) and carried out by economist Jim Power.

Published earlier this month, the report – entitled ‘An Independent Assessment of the Irish Beef Sector’ – put forward a number of recommendations aimed at progressing the country’s beef sector which has been grappling with multiple and substantial challenges in recent years, namely: poor prices; below-cost selling; and deep-rooted allegations of conspiracy along the food-supply chain.

However, after 13 months investigating the sector, Power – the former chief economist with Bank of Ireland, who also worked as treasury economist with AIB Group and Friends First Group – emerged of the view that “no evidence of collusion” exists within the Irish beef industry.

In a bid to disperse such allegations “once and for all”, Power recommended in his 106-page report that the CCPC must “urgently launch a full-scale investigation of the sector”.

However, the state agency has now poured cold water on such counsel.

In response to queries on Power’s above proposal, the competition watchdog issued the following statement to AgriLand:

“The CCPC has no comment to make on the report at this time. In general terms to be helpful however, we can advise that we cannot open an investigation to rule out the possibility of something occurring.

The CCPC’s views in relation to transparency and issues within the beef sector and how they could be addressed have been articulated on a number of occasions and our views remain the same.

“The CCPC continues to engage with stakeholders in the sector to highlight its role and powers,” the statement concludes.

A positive start

Last June, the CCPC stated to the Joint Oireachtas Committee on Agriculture, Food and the Marine that a full investigation into the beef sector was not needed, as the state agency said it had “not uncovered evidence of a cartel operating in the sector”.

However, Power contends that “flexibility” is needed on that decision in order to move the sector forward.

In an interview with this publication last week the economist said that for the mental and psychological impact on farmers, a full investigation by the CCPC could be “a positive start”.

Yes the processors are very profitable; but it is a low-margin / high-throughput business…I don’t believe there is collusion; but farmers do.

“Farmers need to be convinced of that, because they don’t believe me. I may be wrong, but all I can say is I didn’t see any evidence of collusion.

“Farmers don’t appear to have the right information and that is why this investigation is so important.

“If the competition authority went in and found there is evidence of collusion, then farmers would feel vindicated; but if they went in and found there is no collusion, well at least they now know.

“Then that might shift the focus to the more important areas,” Power said.