Responding to the news that large supermarket stores have slashed vegetable prices to as low as 39c/kg in the run-up to Christmas, Joe Healy said he is completely against low-cost selling at any time of year.

“The practice of below-cost selling undermines the value of the food farmers produce and ultimately puts pressure on farm-gate prices,” he said. “I am completely against this practice at any time of year.”

Healy added that although the bigger supermarkets can afford to make up the cost of selling at very low prices, smaller fruit and vegetable retailers cannot.

It’s a distortion of the market

“The smaller fruit and veg retailers cannot afford to compete with the bigger supermarkets and sell at such a low price. So they are pushed out and the suppliers they would usually deal with are left without a place to sell. So it’s a distortion of the market,” the president said.

A browse of a number of supermarket websites show that German discounter Lidl is selling carrots and potatoes for 49c/kg – down from 99c/kg – and Aldi are selling the same vegetables for as low as 39c/kg. Meanwhile, Tesco Ireland is selling brown onions and “wonky carrots” also at 39c/kg. It is also selling 500g of brussels sprouts and parsnips for 39c.

Response

In a statement to the Irish Farmers Journal, a Tesco spokesperson said that the cost of the promotion is funded by the supermarket chain and not its growers.

“We work closely with our growers to ensure we can offer our customers the best possible value. We price competitively for customers, but we also balance our relationship with farmers to support the creation of a sustainable agricultural sector,” the spokesperson said.

Call on government to intervene

Healy called on the government to intervene to address these issues. “The government has to intervene and ban below-cost selling,” he said.

Earlier this month, in response to a parliamentary question from Fianna Fáil spokesman for agriculture Charlie McConalogue, Minister for Agriculture Michael Creed said the legislative powers to tackle below-cost selling are under the remit of the Minister for Jobs, Enterprise and Innovation, together with the Competition and Consumer Protection Commission. The minister added that the price levels struck by growers with retail outlets “are entirely a commercial matter”.

“While it is not my role to set supermarket prices for agricultural products or to be involved in price negotiations between growers and retailers,” he continued, “I very much encourage greater co-operation and discussion between all parties in order to ensure the viability of the largest number of Irish vegetable growers possible.”

Spend at Christmas

Figures from Kantar Worldpanel show that 9% of shopper spend for the year is in the Christmas period (end of December to start of January).

The average Christmas grocery shop is €86.80, the biggest all year, 42% of the spend is on promoted items and 79% of the spend goes to the big three retailers – Tesco, SuperValu and Dunnes.

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