Sunday Times report: Grocery prices on the increase and it could be our fault

It was this time last year that Cheapeats covered a price comparison survey by The National Consumer Agency of Ireland that showed a drop in food prices in Ireland in the first half of 2009.

Well, it would seem that dream is over and prices are creeping back up across the board.

All was revealed in a worrying Sunday Times article about a Eurostat report on price comparisons across Europe. The report showed that Irish consumers are paying over the odds for home-sourced foods such as meat and dairy and groceries in Ireland are the second dearest in Europe after Denmark. Here are a few of the reports findings:

• Ireland pays 29% more than the EU average for groceries. Instead of prices coming down, food prices were relatively higher in 2009 than in 2008 or 2007.
• Although Ireland is a big producer of beef products, Irish meat prices were found to be 21% higher than average and considerably more expensive than in the UK, which imports about one fifth of its beef from here. This is not down to Irish farmers taking a bigger cut, far from it, even though food prices in the UK are lower, farmers there actually get paid more than their Irish counterparts.
• Irish prices for milk, cheese and eggs are even further out of line – 37% higher than the EU average. Meanwhile, the price paid to the farmers for milk has collapsed, from 40c a litre in 2007 to 20c.
• Retail Ireland claims food prices have fallen 8.6% in the last year, and are now back to the level of March 2006. However, analysis for The Sunday Times by the consumer website smartshopper.ie tracked the price of 200 items in Dunnes, Tesco, Supervalu and Superquinn and the results indicated that falling prices are not reflected in shopping bills.
• Tesco, the most expensive of the four, has actually increased the cost of the basket of goods from €562.04 to €575.49 in the past year, as has Supervalu – from €553.05 to €558.30. Superquinn, by far the most expensive at €602.01 a year ago has dropped its prices to €567.22. The cheapest store, Dunnes, has shaved off 6% off the total to €509.81, down from €539.81.

Everybody across the economy has taken a cut but the retailers have increased their margin. So why is this? Retailers blame wages, rent and commercial rates but a Fortas report showed that although there is a higher cost of doing business in Ireland, it’s nothing to the extent that the industry states.

It would seem that we, the Irish consumer, are part of the problem. Back in 2008, consumer demand for lower prices sparked a price war among retailers but Irish shoppers seem to be falling back into old ‘Celtic tiger’ habits, becoming more complacent and shopping around less. Be warned people, if we, the consumer, relax and don’t split the basket, retailers will go back to their old ways and we’ll become a rip off republic once again.

Have you noticed a sneaky increase in food prices and are you shopping around less?