Scottish food price cap plan worries farmers
Scottish farmers fear government plans to cap prices on essential food items will force supermarkets to pass financial losses down the supply chain
Farmer Jamie Wyllie says Scottish government plans for food price caps are giving him sleepless nights. He fears large retailers will pass any financial losses from the policy down to producers like him.
Wyllie, an office holder in the National Union of Farmers in Scotland, runs farms specialising in pigs, sheep, and crops. He stated his business makes "little to no margin as it is." His concerns are shared by 23 organisations which recently wrote to First Minister John Swinney urging him to scrap the policy.
The proposed price cap policy
The Scottish government is consulting on a plan to cap prices for up to 50 essential items. These would include staples like milk, eggs, cheese, and rice. Large supermarkets would be required to offer at least one variety of these goods at a capped cost.
If the capped product sold out, retailers could be required to offer a similar alternative at the same price. First Minister John Swinney has said he has a "public health responsibility" to ensure people can afford a healthy basket of goods. The specific products beyond the four named staples and the potential price levels have not yet been determined.
Farmer fears over cost pass-down
Ministers insist the financial burden of the policy will fall on major supermarket chains. Jamie Wyllie is sceptical. "I struggle to see how, or why, they would swallow that cost," he said. "They'll pass it down to us. We see it all the time."
Wyllie explained that as the producer, he is at the bottom of the supply chain. "I can't pass my costs on to anybody else," he added. He worries the cap could be a final burden that makes producers reconsider their operations.
His production costs have risen sharply in recent years. A UK government national insurance hike and a looming UK-wide fertiliser tax will impact his farm. His energy costs have doubled, with a standing charge of £1,500 per month before any electricity is used.
Broader industry and political context
The Scottish government hosted a 'fair food summit' with producers and retailers. Business Minister Tom Arthur met organisations to discuss concerns. An invitation stated the goal was to "work together to ensure that people across Scotland can afford their weekly shop in a way that works."
Many producers are sceptical, seeing a conflict between capping prices and protecting producers. John Swinney has made the cost of living a top priority and appears determined to implement the policy. The UK government has also asked retailers to freeze some prices, though without legal force.
An impact assessment published last week included options that could dilute the policy. One suggestion allows prices to rise but at a rate below general food inflation. The policy remains one of Swinney's most eye-catching proposals, born from a key voter concern. Convincing farmers it won't harm their livelihoods will be a significant challenge for ministers.
