THE FOOD industry could be damaged by excessive profit-taking by large supermarket chains whose responsibility does not stop just with the consumer and their shareholders, according to Minister for Agriculture Brendan Smith
In a speech delivered yesterday at the International Federation of Agriculture Producers Commodities Conference in Dublin Castle, the Minister said the responsibility must also extend to producers, processors and suppliers.
“I have told the supermarkets the farmers have invested heavily, the processors have invested heavily and the State has invested heavily in building up a very significant food industry.
“This industry produces food to the highest quality, the highest nutrition and the highest safety standards. The producer and the processor need an adequate return to ensure the food production base is not diminished and we have a sustainable agricultural system.
“At present, the returns to the primary producer and in many instances, the processors, are not adequate and there are not the fair and balanced returns that are necessary,” Mr Smith continued.
He said he had made the case to the supermarkets that they had access to top-quality food and that production, processing, packaging and distribution were integral parts of the food chain, the same as the retailer.
Asked if supermarkets continuing to take the levels of profits they do now risked damaging agriculture, Mr Smith replied: “Absolutely. That would be a serious concern to me.”
He was seeking a fair and balanced return for all parts of the food sector and was working with Tánaiste Mary Coughlan on the details of a code of practice.
Mr Smith acknowledged that the development of the agri-food sector depended on the market access provided by large multiples.
“Some of the largest food companies in the world, which started on a much more modest basis in Ireland, would never have achieved their present status had it not been for their access to the domestic market,” he said.
The Minister said the importance of the sector, which supported 230,000 jobs, could not be overstated.
He also told delegates his decision to close the Rural Environment Protection (Reps 4) agri-environmental scheme to new entrants this year had nothing to do with the McCarthy report. He said its timing was due to a need for prudent financial management and because a revised Reps scheme had to be submitted to the European Commission by July 15th.