With Morrisons still the front runner in the race for Safeway, a Morrisons victory would be largely welcomed by suppliers who would have been more fearful of a decision in favour of Tesco, Sainsbury's, or particularly, Asda.

Martin Dunnett of Capespan which supplies both stores, commented on the likely outcome. "It is not a done deal yet, but it will be good to have this settled and have some balance in the business. If Morrisons does win, then it will certainly bring a fresh approach. It will also mean that there is no one player that is totally dominant."

An amalgamation of the Safeway business into Morrison's would bring logistics challenges, said Dunnett. "Morrisons has a much more trading-based style with deliveries into the back door whereas Safeway has more of a network-based system."

Grower-suppliers are also positive about a potential Morrison's victory.

NFU head of marketing Robin Tapper said: "We're glad to see that a considered approach has been taken on the question of further consolidation in the retail sector.

"Farmers will not be thrilled about the prospect of further concentration of retail power in the food chain. However, the potential loss of Safeway needs to be seen in the context of the corporate philosophy of Morrisons.

"The chain has a good understanding of UK agriculture and a strong commitment to regional and local sourcing of product as well as operating its own processing and packing capacity for...fresh produce."

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