Food prices debated amid concerns over supermarket domination

Monday evening sees MEPs consider the emotive subject of food prices in Europe. In particular the focus will be on the role of large supermarkets and the amount they pay farmers. At present shoppers can pay up to 5 times the cost of some items of food compared to the price at the farm gate. In the late 1950's farmers received half the retail price of food - this has now slumped to 7% in the UK and 18% in France.

The report says that large retailers can sometimes abuse their position and distort competition to the detriment of shopper and farmers alike. In particular they are concerned about the effect of supermarket price wars on farm wages. It also notes the fact that many dare not complain for fear the supermarket will buy goods elsewhere.
 
Selling food at below cost price a concern
 
The report by Greek Socialist Katerina Batzeli for Parliament's Agriculture Committee calls for a Europe-wide investigation into retail prices, a database of food prices to be set up to allow comparison and a telephone hotline for consumers and farmer's so that report instances of abuse of the pricing system. It comes in response to the Commission Communication entitled Food prices in Europe.
 
In the UK a report in 2006 noted that the four largest retailers controlled almost three quarters of the entire grocery market.
 
In addition the Batzeli report identifies concerns about the number of small businesses that are being driven out of business by larger retailers. One of the practices used and deplored in the report is the practice of selling goods at below cost prices. The report also raises concerns about the increasing amount of speculation on the price of food.