Farmers vs Supermarkets: Food Price Crisis Explained
Irish Grocery Prices: Not as Bad as you Think, Says Competition Watchdog
Despite feeling the pinch at the checkout, Irish grocery prices haven’t risen as much as those in other European countries, according to a new report from the Competition and consumer Protection Commission (CCPC). The findings challenge the narrative of supermarket profiteering that has gained traction, and deliver an unexpected message to a Government eager to find solutions to the cost-of-living crisis.
The CCPC’s analysis reveals a 27 per cent increase in grocery prices between 2021 and June 2025 – substantially lower than the EU average of 35 per cent. In fact, Ireland has experienced below-average grocery price inflation for 15 of the last 16 years, a trend unbroken until 2024.
“the high-level inflation figures do not suggest any meaningful market problems in the Irish grocery retail sector,” the report states.”If anything, the evidence suggests that Irish consumers have experienced significant price benefits compared to European counterparts.”
This conclusion is unlikely to be welcomed by the Government, which had anticipated evidence of supermarket excess and was prepared to intervene. The CCPC’s report even suggests supermarkets deserve credit for keeping prices down despite pressure from food producers.
The watchdog attributes the relatively restrained price increases to “increased competition in the grocery retail sector,” pointing to the growth of own brands by all the major players. This competition, it argues, is driving positive dynamics, including new products, services, and aggressive price offers.
But why are food prices rising? The CCPC identifies two key factors. Firstly, Ireland is inherently an expensive economy, burdened by structural issues like higher wages, geographic isolation, and elevated costs in areas like construction, legal services, and insurance.
Secondly, and more significantly, food producers are increasing their margins. While agricultural output prices largely mirrored input costs until 2024, a sharp divergence emerged last year. Agricultural output prices surged by 19.3 per cent in 2024, dwarfing the EU average of 2.6 per cent.
the CCPC stops short of explaining this margin expansion, but suggests the motivation is likely the same as any business in a high-inflation surroundings: the ability to increase prices.
This raises a difficult question about fair and lasting margins in Irish farming, but one the Government will likely avoid. While politically expedient to blame supermarket chains for rising grocery bills, targeting farmers carries a far greater risk. The CCPC’s report, therefore, presents a complex challenge, suggesting the problem isn’t simply one of supermarket greed, but a broader economic picture where producers are capitalizing on inflationary pressures.