Farmers remain price takers rather than price makers – Cllr. Leahy

Cllr. Leahy has called on Minister for Jobs, Enterprise and Innovation, Richard Bruton,to exercise his power andmove the ‘Consumer and Competition Bill’ through the legislative process as soon as possible in order to bring about fairness in the whole process between retailers, processors and primary producers, which would prevent retailers having excessive profit margins on farm products. These farm products are often only in the possession of the retailers for a short time but they still manage to make a far bigger profit on the product than the farmer. FG promised in their election manifesto that they would regulate this anomaly but have so far failed to do so.

At the December meeting of Offaly County Council Cllr Leahy expressed his disappointment that farmers remain price takers rather than price makers. Cllr Leahy stated that “no other sector in the business world would allow his/her product leave the production floor without knowing the exact price for their product or more importantly if the price they were getting was covering the production costs. Farmers, the primary producers, are not treated fairly in the processing trail, which sees their product leaving the farm yard to go the processor, then onto the retailer and finally on to the consumer. Each element of the processing trail has a bigger profit margin than the farmer and this is especially so in the retail sector. Is it fair that retailers who only have the product on their shelvesfor a short period of time before being sold to the consumer have the largest portion of the profit margin?Oftentimes the large retailers sell a product at a much reduced price – a price that does not even cover the cost of production and use this as a means of enticing customers into their supermarkets. The large retailer still makes a profit but the farmer, the primary producer, may not be receiving a price that covers his costs.  Farming is not a nine to five job, it requires 24/7 attention. If you add up the hours worked in one week in many sectors in farming and divide it into the money received for the product, you would be astonished to find that many farming families do not even earn the average industrial wage. Farming is a vitally important productive sector in the Irish Economy, supporting 300,000 jobs and proving the raw material for 9bn in export earnings. It is vitally important that this sector is protected.

The consequences of a disastrous summer and escalating input costs for feed, fertiliser and energy have put massive pressure on farm incomes. As farmers face into 2013, producers’ prices must rise to cover these higher costs. Pig, poultry, liquid milk and fresh produce prices are falling below the cost of production, yet retailers continue to profit at the farmers’ expense. The Government have failed to deliver on their promise to farmers to regulate the retail multiples. The Minister needs to act quickly to bring about fairness in the processing trail and ensure that the primary producer gets a fair share of the market.

“That Offaly County Council ask the Minister for Jobs, Enterprise and   Innovation, Richard Brutonto exercise his power as promised in the FG election manifesto and to move the ‘Consumer and Competition Bill’ through the legislative process as soon as possible in order that fairness is implemented in the whole process between retailers, processors and primary producers and to prevent retailers having excessive margins on farm products that are only in their possession for a short period of time