Asda is facing the wrath of of rivals and suppliers alike after slashing the price of bananas to their lowest point for 14 years and sparking a "pointless" price war.

The supermarket has gradually cut the price of loose bananas to just 47p/kg over the past month, 44% down on August and less than half the 99p/kg seen over Christmas. Tesco and Sainsbury's have price-matched Asda, while prices at Morrisons fell to 57p/kg and 59p/kg at Waitrose.

And the discounts are showing no signs of ending, with Asda due to cut again to 46p/kg in time for the weekend. "Our job is to do all we can to help cut the cost of living for families across the UK and there's no better way of doing that than by lowering prices on core staples that go into millions of shopping trolleys every week," said produce director Alex Brown.

The move comes as Asda boss Andy Bond unveiled a new age of "democratic consumerism" this week, in which shoppers are put at the heart of the company's decision-making and invited to participate in choosing products and contributing ideas.

Supermarkets, which are understood not to have passed the cost of the banana cuts on to suppliers, are having to absorb millions of pounds as a result of the discounting, with Waitrose MD Mark Price claiming it was costing his company well over £100,000 per week. "Asda crashed the price of bananas and you have no option but to follow the market and be competitive," he said. Price also criticised Asda for instigating the "pointless game" of heavy discounting on the fruit.

The move was a strategic ploy by Asda to put pressure on rivals' margins, one senior industry source claimed. Although Asda is having to take a hit itself, Tesco sells almost twice the number of bananas Asda does, while Sainsbury's has to swallow larger margin losses due to its policy of only selling Fairtrade. "If it's costing Asda £500,000 a week then it will be costing Tesco £1m," he said. "Sainsbury's must be hurting big time."

The latest price war has dismayed importers, who had been calling for supermarkets to raise the price to £1.20/kg to ensure the industry remained profitable and could invest in facilities. "It's a ridiculous price, there's no rhyme or reason to it and there's nothing happening on currency or fuel to explain it," said one major importer.

Although research showed consumers were largely unaware of the price of bananas, there was a danger shoppers would come to expect low prices and eventually the cost would be passed on to growers in developing countries, he said.