Farmers will be “very sceptical” over cuts by retailers to consumer prices, according to outgoing Irish Farmers’ Association (IFA) president Tim Cullinan.
Cullinan was responding to the confirmation from Aldi today (Wednesday, January 3) of a new series of price cuts, leading to speculation that other supermarkets could follow suit.
Last year, Aldi, along with other retailers, announced a series of price cuts on consumer staples like bread, milk and butter.
The retailer said today that prices have been reduced by up to 23% and, as a result, the cost of a typical trolley of the most popular goods has reduced from €121 to €106.
Aldi confirmed that prices would be reduced for crumbed lean ham, sliced chicken and turkey, smoothies for children, Irish beef burgers, and free-range chicken fillets, among other items.
According to Cullinan, farmers would be unlikely to welcome “the latest publicity blitz by some retailers claiming to champion consumers with lower prices”.
“If the retailers want to engage in combat for customers, it cannot be at the expense of farmers and producers. The idea that primary producers can afford to take a lower price flies in the face of higher input costs,” he added.
The IFA president commented: “The food chain cannot survive if relentless pressure is piled on those who produce the food.
“It costs money to deliver quality food to supermarket shelves. This has to be recognised by giving a fair margin to those who put in the work and investment on the ground. Pretending that it can be done for less is not serving anybody.”
Cullinan said that targeting fresh food for price cuts is “too easy an option”.
“Retailers know that consumers go shopping for food, but farmers and producers cannot be the frontline of another retail war. Retailers cannot use their dominant position in the food chain to reduce farmers’ margins while protecting their own,” he added.
Cullinan said that this “dominant position” of retailers is something that should be addressed by the new office of An Rialálaí Agraibhia (Agri-Food Regulator).
“This imbalance in power in our food supply chain is something that the new Agri-Food Regulator must investigate and act upon,” he said.