The Irish Farmers’ Association President, Padraig Walshe, has said there is no justification whatsoever for bread costs to rise by between 12c and 16c per loaf based solely on wheat cost increases paid to farmers.
Mr Walshe said consumers should not believe that this cost rise is totally to do with the cost of wheat.
Mr Walshe said a 25% in wheat costs should translate into an increase of 2.3c, at most, in the cost of a standard loaf.
Advertisement
He said farm gate wheat costs this harvest have improved by around €15 to €20 per tonne after declining steadily for the last decade.
Mr Walshe said despite lower costs to farmers in recent years, the benefit was clearly not passed back to consumers.
His comments come following a warning from a lobby group representing the Irish food and drink industry.
Costs must be passed on: IBEC
IBEC’s Food and Drink Industry Ireland group had warned that food cost rises of between 5% and 20% on essential items like bread and cereals are on the way.
Its director, Paul Kelly, said dramatic increases in the cost of energy, services, labour and ingredients have driven up food production costs, and that companies had no option but to pass on some of these costs to retailers.
Today’s warning comes less than a year after consumer groups applauded the Government for ending the ban on below-cost selling which, they had argued, kept grocery costs artificially high.
The food industry credits itself for containing food cost increases to under 2% last year, well below the rate of inflation. But it says raw material costs are increasing.
The cost of wheat has grown by a quarter and more recently there have been poor harvests. Fruit used in products such as orange juice has grown 35% globally with more increases to come. There is also a shortage of fish and key ingredients like tomato paste, rapeseed and glucose have all risen in cost.
Then there are higher energy costs and increases in recycling costs. The trade says packaging costs have gone up 10%.
And in a move to head off allegations of consumer rip off, the industry says consumers should look to the Government which it says could ease many of the extra costs hitting Irish business.
Commercial rates have grown 15% in the last three years while water charges have grown 8%.
And it says that inflation at 4.9% is among the highest in the eurozone and that is feeding a spiral of wage demands.
And if you were wondering about Daniel Radcliffe, he is a terrible role model.