Supermarket fights rise in price of bread

A supermarket chain has gone to war with Ireland's leading bakeries over their demands for a 10 per cent increase in the price of bread.

Dunnes Stores is resisting a rise of 10-15 cent a loaf which has crept into many shops in recent days.

The IBEC-affiliated Irish Bakers' Association (IBA) has claimed an increase in price is justified due to increased production costs. However, Dunnes Stores has responded by refusing to stock certain products from major bakeries, including Brennans and Irish Pride.

In a statement to Dublin radio station Lite FM, which first reported the product boycott, the supermarket chain said it had asked the two bakeries to "immediately re-examine and review their overall trading terms where price increases are necessary".

Labour Party TD Mr Joe Costello welcomed the "stand" taken by Dunnes Stores, and said he hoped other retailers would follow suit.

However, Ms Rosemary Garth, secretary of the IBA, said the bread industry had already absorbed "significant cost increases".

According to the IBA the exceptionally dry summer cut the European wheat harvest by 10 per cent, driving up the price of grain and flour.