Food suppliers hit back after Tesco boss accuses manufacturers of ‘greedflation’
A FOOD scrap has broken out between supermarkets, suppliers and farmers.
It comes after the boss of Britain’s biggest retailer accused manufacturers of “greedflation”.
John Allan, chairman of Tesco, said at the weekend that food producers were increasing prices “more than they need to”.
Tesco fell out with ketchup-maker Heinz over price rises last year and stripped its products from shelves.
But industry figures said it was rich for Tesco to play consumer champion as it was on track to make £2.6billion of profits this year, helped by higher prices.
Rival Sainsbury’s is also making more profits than expected.
Minette Batters, president of the National Farmers’ Union, said that Mr Allan was living “in a parallel universe”.
The NFU chief said that cost-inflation had been “unprecedented and it has dwarfed any price increases to date”.
Karen Betts, chief executive of the Food and Drink Federation, explained why producers were raising prices.
She said: “We know we’ve a responsibility to keep food and drink affordable. But production costs have risen significantly in the last two years and some costs are passed on to consumers.”
A spokesman for The Groceries Code Adjudicator said that negotiations on inflation were the biggest source of tension between supermarkets and suppliers.