Retailer cost cutting putting fresh milk supply in shops at risk warn dairy farmers
Dairy farmers that produce fresh milk have hit out at unsustainable discounting of milk by Iceland and Aldi in the recent weeks.
The Fresh Milk Producers group slammed the move as ‘socially irresponsible’ and said it is putting a complete supply chain of fresh perishable food in danger of being decimated in the Republic of Ireland.
Group Chairman Jim Mulhall, a liquid milk supplier to Glanbia from Kilkenny said “Aldi is currently selling fresh milk at €1.30 for 2 litres.
“This is below the true cost of putting that milk on the shelf and is not economically sustainable. Iceland is also offering a deal of 4 litres of milk for €2.60 litre.
Mr Mulhall said that at this price point per litre, the supply chain can not support a sustainable price to pay the primary producer.
“While retailers may claim to bear the burden of below cost selling, history has shown us the opposite will ultimately happen, with price cuts ending up on the door of the farmer.
“We have seen this in other fresh food products such as in the vegetable sector, where these unsustainable discounting practices has resulted in unviable margins in this sector and we will not sit back and watch this happen to our product.
“In much of retailers promotional advertising, claims to have developed a plan that includes sustainable sourcing and emphasis on social responsibility is promoted.