Grocery price rise as sterling crash hits us in pocket
Best-selling foods could vanish from Irish supermarket shelves
IRISH consumers could soon feel the impact of Brexit in their weekly shop.
Popular consumer brands such as Lyons Tea, Hellmann’s and Flora could disappear off supermarket shelves or potentially face a price hike.
Retailers are resisting attempts by one of the largest producers of consumer goods to impose double-digit price increases. SuperValu, Centra and Dunnes Stores are holding out as Unilever attempts to raise prices by up to 19pc.
Unilever wanted to negotiate an increase in wholesale prices with supermarkets to compensate for the steep drop in the value of the pound. Sterling has fallen by about 16pc against the euro since the UK’s vote to leave the EU. In response to the row, Tesco halted online sales of Unilever goods before the dispute was resolved. It is not known if the resolution will lead to price rises.
However, Unilever, which makes some of the most popular goods sold here, including Knorr soups, Domestos and Pot Noodles, is still in dispute with Irish retailers SuperValu, Centra and Dunnes Stores.
Managing director of SuperValu, Martin Kelleher, told the Irish Independent Unilever supplies 800 products.
Unilever hasn’t sought a price increase for all those products, but has halted the supply of all of them.
“We’re taking a stance to do what’s right by the consumer. This is not a time for inflation,” Mr Kelleher said. Musgrave has two to four weeks’ supply of Unilever goods, and is expected to stop importing from the supplier this week.
POPULAR consumer brands like Lyons Tea and Hellmann’s Mayonnaise could disappear off supermarket shelves in weeks after a dispute broke over out price hikes.
Retailers are resisting attempts by one of the largest producers of consumer goods to impose double-digit price increases. SuperValu, Centra and Dunnes Stores are holding out as Unilever attempts to raise prices by up to 19pc.
Unilever said last night it had ended its stand-off with Tesco.
The Anglo-Dutch multinational said it is “pleased to confirm that the supply situation with Tesco in the UK and Ireland has now been successfully resolved”.
Tesco Ireland said last night the dispute was resolved to its satisfaction.
It is not known if the resolution will lead to price rises.
Unilever is still in dispute with the indigenous Irish retailers. Unilever makes some of the most popular goods sold in this country, including Knorr soups, Lyons Tea, Flora margarine, Domestos, and Pot Noodles.
Managing director of SuperValu Martin Kelleher told the Irish Independent Unilever supplies 800 products to it.
Unilever hasn’t sought a price increase for all those products, but has halted the supply of all of them as a result of the dispute.
Mr Kelleher said: “For the vast majority of products, there are good alternatives, and our shelves will remain full. We’re taking a stance here to do what’s right by the consumer. This is not a time for price inflation in Ireland.”
But the showdown could mean that as Halloween and the school mid-term break approaches, shoppers could find ghost shelves in SuperValu and Dunnes.
Musgrave, which controls the Centra and SuperValu supermarkets, said it was trying to stop Unilever pushing up the prices of many of the products it supplies by between 10pc and 19pc. The Cork-based distributor and franchise operator has demanded Unilever cut its prices instead of raising them.
Musgrave has two to four weeks’ supply of Unilever goods, and is expected to stop importing from the supplier this week.
It follows a similar row in Britain in which Unilever blamed Brexit and said it needed to raise prices in the UK to compensate for the sharp drop in the value of Sterling.
In Britain, Tesco shelves have been emptied as shoppers panic-buy favourites including Marmite.
It is costing Unilever more money to source raw materials due to the crash in Sterling’s value.
Tesco Ireland would not comment but it is understood the dispute is affecting its 142 Irish stores also. But as of yesterday, Unilever products continue to be available in Tesco stores and via its Irish website.
Retail sources said Dunnes Stores, which has the largest market share in the country, with 150 stores, has rebuffed Unilever’s bid to hike prices. The firm had no comment.
Negotiations
A SuperValu spokesman said: “Due to our refusal to accept what we consider to be an unjustified price increase, we may experience some supply issues on certain Unilever products.
“Negotiations with Unilever are continuing, and we are examining all options open to us.”
The retail giant said it did not consider the price hike to be justified given the collapse in the value of Sterling.
There are fears now that other big multinational suppliers, such as Premier Foods, Kraft/ Mondelez and Nestle, will also attempt to raise prices to make up for losses due to the drop in the value in Sterling in the UK.
Sterling has fallen by 24pc in the past year against the euro.