Retail giants like Tesco must give suppliers a fair price for their produce, Enterprise Minister Mary Coughlan said tonight.
Up to 30 farmers earlier stormed a meeting of Tesco executives in Co Meath to protest at English-sourced potatoes on sale on the supermarket's shelves.
However Tesco said it bought up to two billion euro worth of Irish produce every year and strongly contributed to the food industry.
Ms Coughlan told the Dáil: "Any company, no matter who they are, if they are making a profit and are sustaining their business, they should distribute a reduction in prices to consumers and equally give a fair return to the
suppliers."
She said the Competition Authority was currently examining claims by farmers that their produce was being pushed off shelves by cheaper imports.
The Tánaiste added: "People expect better value for money but this has to be balanced with a sustainable Irish food sector."
Earlier, farmers forced their way into the meeting of Tesco staff at a hotel in Ashbourne and disrupted it for about five minutes.
They brandished packs of English-sourced potatoes they found on the supermarket's shelves.
In a statement, Tesco Ireland has said it was very proud of its contribution to Irish agriculture.
"Tesco is the biggest supporter of the Irish food and drink industry and purchases two billion euro worth of products annually.
"Tesco also helps Irish exports and contributes to the Irish economy. We will continue to work with local producers."
IFA president Padraig Walshe said the farmers' protest reflected the deep anger over Tesco's decision to displace local produce with imports.
"Growers cannot stay in business because of Tesco's ruthless pursuit of profit and market share.
"The persistent pressure on the price paid to the producer will inevitably lead to thousands of job losses and will put Irish producers of local produce out of business," he said.
Fine Gael MEP Mairead McGuinness said small suppliers were being forced to accept reduced prices for their produce.
"Ultimately if we do not check the power of the supermarkets, consumers will lose out through less choice and potentially higher prices in the long run," she said.
"With the internationalisation of retail it is now virtually impossible for consumers to know how the prices they pay relate to the input costs and profit margins of larger chains."
PA