Minister for Enterprise, Trade and Employment Simon Coveney has said farmers “are already getting too small a percentage” from the retail price of food.
He was speaking at a meeting of the Joint Oireachtas Committee on Enterprise, Trade and Employment yesterday (Wednesday, May 10).
The issue of retail price inflation and the recent cut to retail costs of various agri-food produce was one of the main topics raised at the meeting, with one senator, Tim Lombard, asking the minister for his views on how the cut to consumer prices would impact primary producers.
Minister Coveney said that reducing prices was necessary to protect consumers, but that these price cuts should not be passed directly back to the producer.
“I understand only too well the pressure on primary producers, and at times the pressure they are put under from the retail sector in Ireland, which is driven by a competitive market in the retail sector which has by and large functioned well in terms of consumer prices,” he commented.
“We have a particular issue at the moment where food inflation in supermarkets is running at double what inflation is at. We need to be careful in terms of how we respond to that,” he added.
Minister Coveney said that “we’ve got to get prices down to protect consumers, by we’ve also got to make sure that those price reductions aren’t at the expense of primary producers, and that that reduction in inflation that needs to happen in the food retail sector isn’t essentially transferred straight on to the primary producer”.
“In my view, primary producers are already getting too small a percentage of the final retail price, whether it’s a litre of milk, or a pound of butter, or a whole range of other products.
“I can assure you we will be very much thinking about a farming and primary producer perspective in any of the conversations we are having with retail outlets in the next few days,” the minister said.
Minister Coveney’s comments reflect those of a minister of state at his own department, Neale Richmond, who met with retailers yesterday.
In a response to a series of questions from Agriland yesterday, he said: “Our farmers haven’t seen the prices they’re paid at the farmgate increase at the same rate we’ve seen prices go up at the checkout, despite very real increases in costs for them, from fertiliser, to energy, and much more.
“We are expecting both the retailers and food companies to act in a manner that drops prices at the checkout, especially in staple goods, while also protecting the prices paid to our farmers,” Minister Richmond said.
Following his meeting with the Retail Forum, he said that he had “received assurances” from retailers that consumers will benefit from grocery price cuts, but only where inputs cost reductions filter through to products.