Minette Batters, president of the National Farmers’ Union (NFU), said food producers were “baffled” by claims of profiteering, insisting that soaring energy bills were to blame for their products costing more in shops.
It came after John Allan, the chairman of Britain’s biggest supermarket, said the company had “fallen out with suppliers” and was trying “very hard to challenge cost increases”. He accused suppliers of taking advantage of surging inflation by raising prices.
The comments sparked a furious war of words with food companies and farmers. Ms Batters told the BBC’s Wake Up to Money podcast: “It was almost like he was living in a parallel universe.
“We are seeing wholesale gas prices 650pc higher than it was back in 2019 and the cost inflation on the back of that has been unprecedented. It has dwarfed any price increases to date.”
Karen Betts, chief executive of the Food and Drink Federation, told BBC Radio 4’s Today programme: “Supermarkets are very tough on this. Most supermarkets are asking suppliers to open their books to justify exactly line by line where the cost increases are coming in.
“I think it is difficult for Tesco to come out and say they think companies might be profiteering. I think they absolutely have the evidence for every single price rise.”
Dr Judith Bryans, chief executive of Dairy UK, said dairy farmers and processors had experienced inflation “at every level”, including wages, packaging, transport and energy.
She added: “Dairy businesses have done all they can to absorb as much of the increased costs as they can, but there is a very real limit and eventually costs have to be passed upwards through the supply chain.”