Commission takes aim at retailers in food supply probe

EuroCommerce, an association representing retail, wholesale and international trade interests, stressed that bargaining power is "an intrinsic part of any market economy and in practice both large and small players exert market power," adding that there is no evidence that imbalances in bargaining power are a common occurrence in the EU. 

Regarding the Commission's proposed price monitoring tool, EuroCommerce calls for "commercial realities" to be taken into account and warns against making "simple comparisons". 

As "basic foodstuffs are in general produced and consumed locally, a simple comparison of retail prices across member states will be misleading. Local prices depend on many factors, including the cost levels of raw goods, salaries, transport, VAT, waste levels, fluctuations of currencies and territorial supply constraints. This final aspect prevents retailers from purchasing branded products abroad, so precluding the single market benefits consumers should expect," it stated. 

The European Retail Round Table  (ERRT) said that any food price monitoring tool should promote price transparency both at retail level and "back through all other supply chain actors" to provide accurate information.

It said the challenge is "to collect all the other price data along the supply chain. While the farm gate prices and the final retailer prices are both clear and obvious, the manufacturer, processor, transport, packaging and refrigeration costs that come between the farm and the retailer are much more difficult to gather and assess". 

The ERRT also asks the Commission to address "the barriers that member states themselves erect, which either prevent or deter large retailers from entering their markets, which clearly has a significant impact on prices".

Copa-Cogeca, which represents EU farmers and co-operatives, described the Commission's plans as "a step in the right direction," but warned that "much stronger measures are urgently required" to strengthen producers' and cooperatives' position in the food chain. 

The lobby argues that "the EU food market is dominated by large retailers" and that the growing disparity between producer and consumer prices "has reached such a point that it is vital for the EU institutions to take tangible action". 

Copa-Cogeca Secretary-General Pekka Pesonen said farmers are urgently asking for measures to facilitate and promote concentration of supply, and to address problems of late payments, market abuses and distortions of competition in the food chain.