Growers fear impact of potential prolonged price competition between supermarkets

Concerns are mounting over the potential impact of prolonged supermarket price competition on growers who have seen costs rise but no improvement in returns.

Food prices fell by 0.9 per cent overall between September and October due in part to price competition between supermarkets, but the largest drops came in vegetables (2.4 per cent) and fruit (1.6 per cent).

According to the Office for National Statistics, which produces the figures: "Significant and widespread discounting by supermarkets and good harvests for certain produce led to a large number of downward effects."

English Apples & Pears chairman Adrian Barlow said: "October is when the main English varieties first hit the shelves in volume. We expect strong promotional activity then, and support their being made visible in-store.

"But this year prices have shown no increase, while production costs have increased by seven per cent, mainly due to the rising costs of energy and fuel."

He added: "We have to be realistic given the state of the economy. But unless we see an improvement in returns to growers, investment will be constrained, so ruling out any increase in apple and pear production."

Processed Vegetables Growers Association commercial manager Tim Mudge said: "This is not the first time the rate of inflation has been directly attributable to a price war between supermarkets.

"On this occasion they say they are funding it themselves, but suppliers say they are under pressure with margins - even though they haven't been told directly: 'You must fund this.' Their fuel and transport costs are still going up."

Consumer View - Unit price information 'unclear and inconsistent', says watchdog

The consumers' association Which? pointed out that "unclear and inconsistent" use of unit price information in supermarkets makes price comparisons unnecessarily difficult for shoppers.

It found different units were being used for different varieties of the same product, such as pre-packed onions being listed "per item" next to the loose equivalent being listed "per kilogram".

Unit price data was found to be lacking entirely in some promotional lines.

Which? executive director Richard Lloyd said: "We want to see retailers and the Government make urgent improvements so that consumers can compare like-for-like in the supermarket."

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