The Irish Farmers Association has slated a move by retail group Musgrave – owner of SuperValu and Centra – to seek tenders for their egg supplies via an online auction.
“This is a blatant attempt to force a beleaguered industry to drop the price of eggs below the cost of production, which is not sustainable,” said IFA poultry committee chairman Alo Mohan.
“The process involves suppliers blindly bidding against each other in an effort to secure the Musgrave business. The end result is that a supplier wins the tender at a lower price than the previous year.
“Retailers, including Musgrave, are well aware that the feed price increase of the last year has not been recovered by producers and yet they are now trying to reduce prices through this process.”
But Musgrave said in a release they were disappointed with the statement by the IFA, saying they have used the e-auction tool since 2005 for the purchase of all their own-brand eggs.
“Musgrave believes it is a fair and equitable system, which allows new entrants to compete in the market,” said a statement from the company.
“It also provides Musgrave with the opportunity to ensure it can get its own-brand egg products at the best price possible, to ensure we can continue to deliver the best value possible to the consumer – a particularly important issue in today’s tightening economic climate.”
Recently Musgrave added the supermarket chain Superquinn, which had been in administration, to its stable, and set up a fund to pay creditors about 65-70 cents of every euro they were owed.