SUPERMARKETS should not be allowed sell milk, bread and other staples below cost, an Oireachtas committee has said.
It has called for tough new controls on the grocery industry to stop suppliers being abused.
It also wants supermarkets and food producers to be forced to disclose their turnover and profit margins in Ireland to ensure more transparency.
And it said a ban on below-cost selling of staples such as milk is needed to stop producers going out of business which could lead to supplies drying up.
The Committee on Agriculture and Food published its report on the Grocery Goods Sector today calling for better labelling and a code of conduct to protect suppliers.
Chairman Andrew Doyle said that stopping below-cost selling of staples would not lead to higher prices to consumers as even when supermarkets cut the price of one thing, they hiked prices elsewhere to maintain their profits.
The cross-party report specifically called for a ban on below-cost selling of milk and minimum prices for alcohol - with the latter proposal backed by government yesterday on health grounds.
But Mr Doyle said that a ban on below-cost selling should ideally be extended to all staple food products.
"The Committee is concerned that the large multiples and wholesalers appear to be exerting undue pressure on pricing on producers," he said.
Fianna Fail farm spokesman Eamon O Cuiv warned that without protection of the price paid for liquid milk, it could disappear from shelves in a couple of years as it wouldn't be worth farmers' while to produce it.
"People would get a shock if all they could get was UHT milk," he said.
A statutory code of conduct would safeguard the family farm structure and primary producers, and make the retail sector more transparent, the report found.
Retailers had claimed that a statutory code of conduct would add to costs and prices but had not backed this up with evidence, the committee noted.
The Irish Farmers Association called on the government to implement the report's proposals immediately.
"The report supports IFA's contention that retail multiples are over dominant in the food supply chain and are engaged in unfair and predatory pricing practices," said IFA president John Bryan.