Farmers' Protests in Germany: Greens Attribute Agricultural Woes to Supermarket Chains
Source: The DairyNews
As farmers in Germany stage widespread protests causing traffic disruptions, voices within the Green party, part of the ruling coalition, are pointing fingers at major supermarket chains' pricing policies for the dire economic situation faced by many farms.
Led by the German Farmers’ Association, the protests aim to pressure the government to maintain subsidies on agricultural diesel. While the Greens oppose further changes to the budget compromise, some within the party now shift blame onto supermarkets, accusing them of enforcing low prices and making farmers reliant on subsidies.
Green MEP Anna Cavazzini highlights the high market power of supermarkets in Germany, where three-quarters of the market is controlled by just five companies. She emphasizes the impact of this dominance on farmers, leading to price squeezes, unfair contract conditions, and a lack of predictability.
German Agriculture Minister Cem Özdemir, also fr om the Greens, echoes these concerns and accuses the previous conservative government of weakening farmers' market power. The ministry is exploring ways to support dairy farmers and achieve better prices through market intervention.
However, competition economist Justus Haucap sees the focus on supermarket power as a "smokescreen." He argues that prices in the German food retail sector are influenced by European or global markets, and overproduction fueled by subsidies is a significant factor.
Haucap suggests that blaming supermarket chains is a diversion tactic, reminiscent of the "greedflation" narrative, wh ere external factors were held responsible for inflation. The debate prompts calls for increased intervention by competition authorities, but evidence for profit-driven price increases remains contentious. Last year's amendment to German competition law granted more power to tackle anti-competitive practices, but legal hurdles remain high.
Green MEP Anna Cavazzini highlights the high market power of supermarkets in Germany, where three-quarters of the market is controlled by just five companies. She emphasizes the impact of this dominance on farmers, leading to price squeezes, unfair contract conditions, and a lack of predictability.
German Agriculture Minister Cem Özdemir, also fr om the Greens, echoes these concerns and accuses the previous conservative government of weakening farmers' market power. The ministry is exploring ways to support dairy farmers and achieve better prices through market intervention.
However, competition economist Justus Haucap sees the focus on supermarket power as a "smokescreen." He argues that prices in the German food retail sector are influenced by European or global markets, and overproduction fueled by subsidies is a significant factor.
Haucap suggests that blaming supermarket chains is a diversion tactic, reminiscent of the "greedflation" narrative, wh ere external factors were held responsible for inflation. The debate prompts calls for increased intervention by competition authorities, but evidence for profit-driven price increases remains contentious. Last year's amendment to German competition law granted more power to tackle anti-competitive practices, but legal hurdles remain high.
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