10% cut in retail price share ‘driving potato growers out of business’

Potato growers are being driven out of business by a 10% cut in their share of the retail price, the IFA said at yesterday’s National Potato Conference and Trade Show in Dublin.

However, Minister of State at the Department of Agriculture, Food, and the Marine, Tom Hayes, said new promotion plans should stimulate domestic consumer demand. Mr Hayes, the minister responsible for horticulture, cited the sector’s plan to apply for EU co-funding to support a €1m potato promotion campaign for the next three years. Yesterday’s event was hosted by the IFA, Teagasc and Bord Bia.

“Promotion is now the way forward and the industry should invest in information and promotion measures to stimulate consumer demand for our national Irish crop,” said Mr Hayes.

“Potato growers have experienced difficulties marketing this year’s crop due to a combination of increased acreage, a good growing season and excellent harvesting conditions, coupled with changing market conditions and the diversity of choices now open to consumers.

“To stimulate demand, the industry needs to invest in a structured promotion campaign to drive increased consumption of potatoes in the long term.”

IFA president Eddie Downey warned that potato production is under threat in Ireland because of a falling share of the consumer price for growers and rising input costs.

“The current figures are simply unsustainable,” said Mr Downey. “Costs of production are running at over €200 per tonne, while the producer is receiving much less than this.

“Potato growers’ incomes are unviable and the farm gate price of the product must rise as the price they receive from the market is the most important factor in determining their incomes.”

The IFA leader said the growers’ share is now just 26% of the consumer price, down from 36% four years ago. He warned that the future of an industry, worth over €80m at the farmgate, needs to be secured.

“The Government has a responsibility to deliver retail regulation which will restore equity to the food supply chain,” said Mr Downey.

“Retailers will have to return a viable price to growers that cover their costs and gives them a margin. We have received numerous commitments from the Government on this issue; it is time for action.”

Research from Kantar, to be presented today, reveals that when potatoes are included in a shopping basket, these grocery trips are worth more than average, highlighting the importance of the potato category to retailers.


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