Minister receives promises from retailers to keep grocery prices stable

"Retailers pledge to pass on grocery price cuts to consumers, subject to input cost reductions: Minister Neale Richmond leads Retail Forum meeting"

Retailers have given assurances to the Irish government that consumers will benefit from grocery price cuts, but only where input cost reductions filter through to products. The Minister of State at the Department of Enterprise, Trade, and Employment, Neale Richmond, chaired a special meeting of the Retail Forum on Wednesday, May 10, to discuss grocery prices that have not come down in line with dropping inflation and a fall in energy costs.

According to the latest figures from data company Kantar, grocery price inflation in Ireland was running at 16.6% in the 12 weeks to April 16. The general rate of inflation is close to 6% and is expected to fall further this year. Ahead of the meeting, Tesco Ireland confirmed that it would reduce the consumer retail price of its own-brand bread by 10 cents. The decision, which is likely to be replicated by other retailers, follows a series of milk and butter price cuts in the past week.

Established in 2014, the Retail Forum normally meets on a quarterly basis and includes retail representative bodies, retailers, the City and County Managers Association, and government departments. Members of the forum include Tesco Ireland and the Musgraves Group, which owns the SuperValu and Centra brands.

Speaking after the meeting, Minister Richmond said that he had “an open and frank” discussion with members of the Retail Forum. “We discussed the factors driving inflation for grocery goods, which is higher than the general rate of inflation. It is quite clear that many families and workers are struggling with increased costs at the supermarket checkout. We have seen cuts to the price of butter, milk, and bread prices in recent days; these are to be welcomed. I am pleased to say that I received assurances from retailers that, where reductions in input costs filter through to products, consumers will benefit from this. Increased costs go beyond food; I raised particular concerns about the cost of essential staple items, and there was broad agreement on the need for these items to remain competitive,” he said.

Minister Richmond thanked members for their “constructive approach” to the meeting and said that he looked forward “to continuing our engagement over the coming months”. “The forum will meet again collectively to review this issue at the end of June,” he added.

The minister has also confirmed that he will hold a meeting with the Irish Farmers’ Association (IFA) to discuss the farming organization’s concerns. The Competition and Consumer Protection Commission (CCPC) has warned the government against placing food price caps on groceries. Taoiseach Leo Varadkar told the Dáil that preliminary advice received by the government from the authority “cautions strongly against the introduction of price controls”. The CCPC pointed out that similar proposals in Spain were abandoned because of the impact such a measure would have on small retailers, particularly those in rural areas where higher margins are required to keep those businesses afloat.

Categories: Agriculture