Abolishing the Groceries Order will have a have a lesser effect on reducing prices than had been suggested by the Competition Authority, according to a new report from Goodbody Stockbrokers.
Liam Igoe, food analyst with the brokerage said the Competition Authority had suggested removing the order would contribute to a saving €481 over 12 months, a 9.2 per cent reduction.
However, Mr Igoe suggested a reduction of this magnitude was equivalent to the total profits of all Irish food manufacturers and retailers combined.
He said grocery price reductions would only be possible over time and could only come from lower costs in the food chain.
He questioned how much of the higher cost for a basket of goods in Ireland can be clawed back bearing in mind our island status and small market buying power.
As a result of the abolition of the Groceries Order, Mr Igoe anticipated increased merger and acquisition activity from companies under pressure to reduce costs.