Farmers hit out over 'price war' as supermarkets cut milk prices

Freshly filled Milk Bottles Moving on the Conveyor Belt to the Packaging Area

Cuts to milk prices in supermarkets could risk the sustainability of fresh milk production in Ireland, the Irish Farmers’ Association has warned, while a Labour TD has said the price reduction shows a “tacit acceptance” that consumers are being ripped off.

After Lidl announced a price drop of 10c on the price of a 2-litre of milk yesterday evening, both Tesco and Supervalu issued statements late last night to say they would also cut their prices. Aldi is also following suit.

It follows well over a year of sustained inflation hitting the pockets of Irish consumers’ when they do the weekly shop, with Labour finance spokesperson Ged Nash suggesting that a “trip to the checkout is now as dreaded as a trip to the dentist”.

Recent figures from Kantar suggest grocery price inflation is at a record high, rising over 16% in the last year, while CSO data says that the price of milk is up 24% since the beginning of the war in Ukraine last year.

Labour Party Finance spokesperson Ged Nash says shoppers are being ripped off. File Photo: Gareth Chaney/Collins

“[The milk price cut] is good news for shoppers, and it essentially confirms what I’ve been saying for weeks - price gouging is endemic throughout the grocery sector in Ireland,” Mr Nash said. 

“Government must now commit to working with the CCPC to stamp out this ‘greedflation’ once and for all.

“These big and brave supermarkets must also commit to meaningful price reductions across the range of other products that they are using to cream it in.” 

Mr Nash said the situation requires action and acknowledgement from the Government that “something has to give”.

However, the Irish Farmers Association has said that a “price war” on milk could do serious damage to liquid milk producers.

Keith O'Boyle, the IFA Liquid Milk Chair, said the organisation is concerned about the price cuts. 

IFA Liquid Milk chair Keith O’Boyle said his organisation was very concerned at the price cuts.

“There has been huge inflation in production costs for all farmers,” he said.

“However, those who specialise in fresh milk produce all year round, including over the winter months, have even higher costs. If these farmers do not get a return to cover the extra costs involved, they will change to producing milk for manufacturing.” 

Mr O’Boyle said the number of farmers committed to supplying milk all year round has significantly declined and, while consumers might see price cuts as positive, “it risks the medium to long-term sustainability of fresh milk production in Ireland”.