Sheep farmers fear cheaper supermarket prices could come at the expense of Scottish agriculture
Scottish farmers could end up paying the price for cheaper groceries under proposed food price caps, with sheep industry representatives warning the measures could squeeze farm incomes and increase reliance on imports.
The warning comes as the Scottish government consults on plans to introduce legal price caps on essential groceries, potentially covering products such as bread, milk and eggs sold by large supermarket chains.
Launched in September, the consultation is examining whether retailers should be required to offer certain essential foods at or below a maximum price, with responses invited until 24 November.
Under one proposed model, supermarkets would have to offer at least one qualifying variety of a specified product within the price limit, although the foods covered and how prices would be set have yet to be finalised.
Responding to the proposals, the National Sheep Association (NSA) Scottish Region raised concerns that restricting retail prices could place further financial pressure on farmers and processors without addressing the underlying costs of food production.
Faye Bryce, NSA Scottish Region policy officer, said: "While food price caps may appear straightforward, they risk creating unintended consequences for Scottish farmers, domestic food production and the long-term resilience of our food system."
The association acknowledged the cost-of-living pressures facing households but stressed that food affordability must be considered alongside food security and fair returns for agricultural producers.
According to the Scottish government's consultation, food prices have risen by just under 40% over the past five years, increasing faster than average incomes.
Ministers say the proposals are intended to make essential groceries more affordable, particularly for lower-income households, while recognising the need to consider potential impacts on food producers and retailers.
However, the NSA warned that restricting retail prices would not remove the costs of producing, processing and distributing food, potentially leaving businesses further down the supply chain to absorb additional financial pressure.
"Everyone wants food to remain affordable, but we need to be careful that measures designed to help consumers do not create new pressures elsewhere in the food supply chain," Ms Bryce said.
The organisation also fears that price controls could influence supermarket sourcing decisions, potentially encouraging greater reliance on imported products at the expense of Scottish agriculture.
It warned that weakening confidence in domestic food production could undermine the long-term resilience of Scotland's food supply and increase exposure to future disruptions.
The concerns come amid wider debate over growing reliance on imported food and the potential implications for domestic agricultural production.
The NSA also questioned the practical implications of introducing a Scotland-only scheme, warning that different pricing rules across the UK could create inconsistencies within food markets.
Rural and remote communities could face particular challenges, with the association concerned that any benefits may be unevenly distributed, especially where households rely on smaller retailers.
The consultation currently focuses on large supermarket businesses rather than independent shops, although ministers are seeking views on which retailers should fall within any future scheme.
The Scottish government has also acknowledged that price controls could affect farmers, processors and other supply chain businesses, and is consulting on how primary producers could be protected.
No final decision has been made on introducing the caps, with the consultation examining alternative approaches and the potential consequences for businesses and consumers.
While recognising that government intervention may be needed to address food insecurity, NSA Scottish Region believes targeted support for struggling households would offer a more sustainable solution than direct controls on retail prices.
The association remains unconvinced that food price caps would achieve their intended aims, warning that measures designed to ease pressure on consumers could instead create additional challenges for farmers and the wider food supply chain.