Beware of 5c veg: cheap food always comes at a cost
The supermarkets' aggressive price promotions on festive produce could put Irish jobs at risk and ultimately reduce consumer choice
Published 14/01/2014 | 02:30
WHEN I have very little work to do in the veg patch I have more time to think, and this is generally a dangerous thing. This year, I spent a large part of Christmas fuming at below-cost selling of vegetables by supermarkets. I'm sure you heard about it -- most of the major chains, including Dunnes, SuperValu, Lidl and Aldi, were running special offers on vegetables, with sprouts, turnips and carrots all selling for as little as 5c per kilo.
Aggressive price promotions are a way for supermarkets to entice people in to the store -- they are so effective that supermarkets are willing to lose money on a particular product, knowing that they will make it up elsewhere in your shopping basket.
This is not the first time that vegetables have been the target of price promotions, but it's certainly the most extreme example we've seen. I remember a few years back being amazed when the prices of some vegetables dropped down to €1 per kilo. Then, at Christmas 2012, prices dropped as low as 22c per kilo. At that time, I spoke to a number of growers who told me that their break-even point on a kilo of these vegetables was about €1.20 and a sustainable living was to be had at €1.80.
If we needed evidence of just how aggressive the price war became this Christmas, it was to be found in the fact that across the water in the UK, the same supermarkets were running similar promotions that seemed quaint by comparison. On December 20, Spar in the UK advertised a bag of Brussels sprouts for £1 stg or €1.20 (reduced from £2).
All of which begs the question -- having gone as low as 5c per kilo in 2013, how will Irish supermarkets meet consumer expectations for deals on their Christmas 2014 vegetables? Will they sell sprouts for 1c per kilo? How about this -- do your Christmas shopping with us, and we'll give you your veg for free. Don't laugh -- it could well happen.
The main commentary in late December focused on whether it was the retailers or the growers who were bearing the brunt of these discounts. This question wasn't really answered to anyone's satisfaction. Lidl and Aldi insisted they were absorbing the costs of the promotion.
Around the same time as they were running TV advertisements promoting 19c-per-kilo Brussels sprouts, SuperValu said that the race to the bottom on price was "a step too far that will ultimately lead to a reduction in food quality and job losses in the farming sector". Surely a great example of having your cake and eating it.
The IFA said it didn't believe that retailers were bearing all of the costs of these price promotions. Outgoing president John Bryan said a potato farmer told him that his payment had fallen from €250 a tonne in mid-December to €120 the week before Christmas.
"Have no doubt, the same retailers will make back this reduction many times over," said incoming IFA president Eddie Downey, "either by upping the price on other lines or by demanding a contribution from others in the food supply chain. Either way, they will not take a hit on their profits."
In some ways, it's a moot point whether the retailers are absorbing these discounts. By running these promotions, supermarkets are establishing ever-lower price expectations among consumers for these most important native crops at a time when the cost of producing them is increasing. Vegetable growers are price takers, and don't have the collective bargaining power of beef and dairy farmers -- at some point, the supermarkets will reduce the price they are offering to growers permanently.
So the bottom line is that this constant supermarket-led downward pressure devalues vegetables and puts Irish jobs at risk. And it's not just the vegetable growers that are at risk -- there are jobs at risk further along the food chain, in packing, distribution and wholesale. Smaller, local veg retailers are also put in jeopardy by discounting, and since vegetables are all they sell, they can't make up the lost revenue by making heavy profits on other items.
It's not moral for supermarkets to use their support for Irish farmers as a cornerstone of their marketing campaigns while at the same time using the produce of those same farmers as loss leaders to get people in to stores.
And what of the consumer? Well, in theory these promotions come at a time when consumers are more willing to pay a fair price for Irish produce. In practice, supermarkets wouldn't run these deals unless consumers supported them in their droves.
In that context it was frustrating to see the National Consumer Agency chief, Karen O'Leary, saying these promotions were "great for consumers". Of course, all consumers are looking for value in these difficult times, but it is short sighted in the extreme to support pricing promotions that put Irish jobs and the Irish food industry at risk.
How is it great for consumers that in the long term there might not be an Irish commercial vegetable industry because growers have been put out of business? How is it great for Irish consumers that we will have more imports on our shelves and ultimately less choice and poorer quality? There is always a cost with cheap food.
Michael Kelly is the author of 'Trading Paces' and 'Tales from the Home Farm', and founder of GIY
Grow it yourself diary: week 85
Though 2013 was a year to be celebrated weather-wise, it came with a sting in its tail. December was a horrendous month, and the storms in early January took their toll.
In the run-up to Christmas I had great plans for relaxing days in the veg patch over the Christmas holidays -- these plans were more or less completely scuppered by the weather.
Almost every other day, the wind blew the plastic covers off my veg beds and as I battled to get them back in place, I was cursing the fact that I didn't use straw as a cover instead.
My potting shed endured some heavy storm damage, with two of the Perspex roof panels being blown off and smashed in an early New Year storm. The panels are about 8ft long each and presumably were quite the weapon as they took off in to the gale, so thankfully it happened at night-time when there was no one around.
I have the new panels on order, but while I am waiting on them the potting shed is taking on water like a shipwreck and its contents are a sodden mess. There were some vegetables lying in wait there, awaiting their final journey to the kitchen -- some shallots, and bulbs of garlic and a few oversized courgettes. All fit for the bin now.
Ditto my box of seeds -- though this gives me an excuse to start from scratch and put in another monster seed order. Hurrah.
My gardening diary was also on the shelf and is wrecked -- thankfully I almost never write in it, so that's no great loss.
Grow you body fuel - Courgette
Why Grow them?
They are easy to grow and incredibly prolific, growing freakishly fast in the summer. Two or three plants will be more than enough. Your only problem in fact will be working out what to do with all those courgettes. Courgette bread, anyone?
Sow seeds indoors in pots at a depth of 2cm from April. They will need temperatures of 20 degrees celsius to germinate so leave the pots on a sunny windowsill. Harden off well and transplant in June. Don't be fooled by their size when you are first planting the seedlings out. Courgettes grow to large, hungry and thirsty plants so leave 50-75cm between plants. Dig plenty of well rotted compost in to the soil before transplanting.
Never let the soil dry out -- use a mulch around the plants to preserve moisture. They will need lots of water, particularly when the courgettes are starting to swell. If you have added plenty of manure when planting, they shouldn't need feeding, but if you think the growth is slow use a general purpose organic fertiliser, or make your own comfrey tea. Courgette plants have male and female flowers on the same plant and insects will generally carry pollen from one to the other at which point the female flower starts to become a fruit. If the plants are grown under cover, you may have to pollinate them by hand.
Harvest regularly when the courgettes are about pencil length. They are at their best at this stage, and quickly become watery and relatively tasteless thereafter. The more you pick the more fruit the plant will produce. Don't leave big marrows on the plant as it will reduce the production of new fruits.
GIY Recommended Varieties
Genovese, Cocozelle, Ambassador
Powdery mildew is the most common problem and appears as a white powder on leaves at the end of the summer. It is not a huge issue and mainly just affects the leaves. Slugs are an issue for newly planted seedlings -- protect them carefully!
* Try sowing courgette seeds in biodegradable pots -- they can then be sowed out (pot and all) in to the soil.
* Allow at least some of your courgettes to grow in to giant marrows at the end of the season -- then pick and store them. The thick skin will preserve them over the winter.
Watch GIY tutorials on growing vegetables at www.giyireland.com/videos
Things to Do This Week
* If you have any root vegetables left in the soil, it's probably a good idea to get them out of there now as January-March are months when you get very heavy frosts and inclement weather -- so lift anything that might still be in the soil such as parsnips, carrots and celeriac. Cover down bare beds with mulch, leaves, compost or polythene.
* Rhubarb is typically the first fresh crop of the spring, particularly if you "force" it now by covering it to exclude any light. Put a layer of straw on top of the dormant plants and then cover with an upturned pot. Tender little stems should be ready to eat in March. January is also a good month to split the rhubarb plants if you want to propagate.