SUPERMARKETS have been cleared of making excess profits at the expense of farmers struggling to cope with the financial impact of BSE.
A six-month study by London Economics into the price of meat from farm to shop found the big retailers were suffering a loss, despite a collapse in the prices paid to farmers.
It found that the difference between producer and retail prices was more than accounted for by the extra costs imposed on abattoirs, processors and retailers by measures introduced to eradicate BSE and to restore consumer confidence.
The gap between farm and shop prices had climbed 23p/kg, but the cost of getting beef from the farm to the consumer had risen by 24.7p-27p/kg.
Tesco commissioned the study in response to repeated allegations by farmers that big stores were profiteering by failing to lower their prices in line with falling cattle values. It said it gave the researchers full access to all its accounts.
The National Farmers Union said the study had not answered all farmers questions.
The Times 03/07/98 page 9
- The Guardian 03/07/98 page 23