Growers in the Irish Republic are paid €360 (£317) a tonne for potatoes - but when the potatoes reach the supermarket and are sold in 2.5kg bags, the effective price of the tonne increases to €1,600.
That is one of the remarkable findings in a survey of vegetable growers conducted by the Republic’s main political opposition party, Fine Gael. And its horticulture spokesman, Andrew Doyle, claims that a fair trade deal may have to be introduced if the sector is to survive.
He said: “Abusive trading practices have been stopped by the fair trade movement in Africa and India. Why can’t we do it in Ireland? We have to face the prospect that Irish growers and producers could be wiped out.”
A total of 150 growers across the Republic were contacted for the survey, but only around a quarter responded.
Doyle said: “Many growers were terrified to go public with their claims, even anonymously, for fear of losing sales. Some supermarkets have imposed secrecy conditions, with one grower receiving a warning from a retailer.”
Those who did reply detailed some of the demands being made on them. These included box rebates of 2.5 per cent to five per cent after every monthly payment, extra payments of from 10-30 per cent to cover special offers, personal payments and payments in kind to buyers, long-term credit for buyers ranging from four to 11 months and the cost of last-minute order cancellations borne by growers.
In the survey, growers complained of “relentless pressure” from retailers that could force them out of business. On said: “We’re told we have to match the price of imported vegetables and salads, even if it’s below cost, or not to bother supplying. We’re simply being held to ransom.”
According to Doyle, the findings show that “supermarkets, which control 88 per cent of the fresh food market, are now squeezing growers to breaking point, with many no longer getting the price they need to cover their costs”.
A former fresh produce grower who represents the horticultural county of Wicklow in parliament says he has no confidence that the code of practice being introduced by the government will remedy the situation.
If his party, current favourite to win the next election, is returned to power, it promises to bring in a fair trading bill that will provide for registered agreements between growers and retailers, which will be open to regular inspection by the Competition Authority.
A spokesman for Retail Ireland, representing the multiples, claimed the survey was “too small to be representative” and ignored the fact that supermarkets bought much of their fresh produce through intermediaries. He added: “A large number of jobs has been lost in the retail sector, so it’s not just growers who are feeling the pain.”
