NI: Supermarket villains

By James Campbell

Major supermarket retailers and caterers have been branded as the villains who have brought about the decision to close Ballymoney Foods potato processing operation.

The closure should act as a "wake up'' call to other sectors of the agri-food industry in Northern Ireland, none of whom is so large that it is immune to the squeeze which the big retailers can exert.

Describing the Ballymoney Foods closure as a bitter blow, Ulster Farmers' Union president John Gilliland rounded on the supermarkets and catering trade and accused them of a lack of commitment to the local agrifood industry. He said that the food buyers had opted for low cost competitors even though huge investments had been made by the company's owners, Glenfarm Holdings, to meet the high specifications for quality and traceability of product.

Within the past few weeks Ballymoney Foods won the Tesco supplier of the year award and the company has on several accolades in recent years for quality of its products and systems. Glenfarm chairman Geoffrey Conn says that if all supermarkets showed the same commitment as Tesco then Ballymoney Foods would not be closing down. But it is clear that price discounters in the supermarket business are putting pressure on the likes of Tesco and other major retailers.

In the end the investments made at Ballymoney are apparently worth nothing in the face of lower priced products which some retailers now purchase via internet auctions. Eastern Europe is a major source of these products and some of the large potato processing businesses have already set up operations there.

Pig price drop

Meanwhile pig producers in NI have been left shocked and bewildered by a price drop this week. The unexpected reduction of 4 pence/kg co-incided with a £5 per tonne increase in feed prices. This has plunged producers into loss making. And according to UFU pigs committee chairman Nial Jordan it has again left local farmers questioning their future.

Jordan said it was the first time in living memory that pig prices have fallen in the pre-Christmas period. He accused the retail sector of not delivering on their claims that they are genuinely committed to local production.

There are signs of a similar stranglehold by the powerful retailers on other sectors such as beef and dairy products.

Until recently, the processors have generally passed most of the pressure back down the line through lower prices paid to producers, but now the processors themselves are being seriously squeezed.

The pressure on milk producers in Britain has resulted in open protests there by the group known as Farmers For Action. Now FFA, together with farmers from the Republic of Ireland, France, Belgium, Holland, Germany and Luxembourg are understood to be planning a massive demonstration outside a major UK supermarket distribution centre.

More of this can be expected until EU governments and competition authorities step in to exert some control.