Muted response from farm bodies

There was a muted response to the Tansey report on food production and food prices from the farming organisations yesterday.

The report claimed that the gap between farm gate prices and food manufacturers' prices was not due to high levels of profitability in food manufacturing, and that operating costs were the key to current price levels.

The Agri-Aware organisation last week published research which showed that consumers perceived that retailers were the main beneficiaries from the price of food while farmers were perceived to earn a small percentage of the overall price.

"The IBEC/RGDATA report identifies spiralling operating costs as the reason for what the consumer perceives as the major gap between farm gate and retail prices," said the Agri-Aware deputy chairman, Mr TJ Maher.

"It is hoped that the research will bring about action on the operating costs issue, allowing consumers pay a fair price for food and allowing farmers get an adequate return from the marketplace."

Mr John Dillon, president of the Irish Farmers Association, said there was a constant squeeze on farm gate prices. Because of this, he said, farm incomes were back in real terms by 25 per cent since 1995.

"The report confirms that farm gate prices are not contributing to food price inflation and that costs beyond the farm gate are responsible for the higher prices which consumers are being asked to pay," he said.

Ms Kathleen Lynch TD, the Labour Party spokesperson on Consumer Affairs, said many people felt they were being ripped off and only 28.4 per cent of people interviewed in the Agri-Aware survey believed they paid a fair price for food.

She called for a more effective regime to prevent profiteering because while retailers were entitled to a fair profit, they were not entitled to exploit people.