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  • Writer's pictureFlow Australia

Farmers fear for future as supermarkets crunch costs

Farmers have told an inquiry large numbers of family farms will be forced to close because of low prices being paid for their produce by the major supermarkets.



Farmers and producers have warned of a mass exodus from the agriculture industry because of the low prices being paid for their goods by major supermarkets.


A Senate committee examining supermarket prices has held hearings on Tuesday in Orange in the NSW Central West, with farmers laying bare their struggles in dealing with the powerful duopoly of Coles and Woolworths.


Orchard owner Guy Gaeta, who grows apples and cherries, said major supermarkets had set prices too low for produce, making the future for growers unviable.


'Shut up and let me have a go': MP Bob Katter argues with Nationals Senator Ross Cadell.


"Every year on the news, Woolies is saying they pay people millions of dollars, but yet they put on us whatever they want," he told the inquiry


"At the rate we're going ... there won't be any family farms left within five to 10 years, or you're going to have corporate farms and they're going to be as good as citizens to the consumer as what they are now, and it is scary.


"If you don't have family farms, you're going to lose your food security."


The Senate inquiry was set up following claims of price gouging by major supermarkets to consumers.


But primary producers have warned the market power of supermarkets means they can buy goods cheaply.


Another orchard farmer Ian Pearce told the committee the prices set for goods by supermarkets had largely stayed unchanged over several years, despite labour costs increasing.


"In 2011, we got $2.37 a kilo and $2.55 a kilo. Last year in September, similar timing, $2.60 and $2.57 a kilo," he said.


"We're very dependent with apples on the domestic market ... we're caught in a cost price squeeze."

Farmers Ian Pearce, Guy Gaeta and James McClymont appear at a hearing into supermarket pricing.


Farmers' Group president of Dairy Connect Graham Forbes told the committee mandatory codes of conduct needed to be brought in across the grocery sector.


It was not a silver bullet but it would address some of the concerns, he said.


A mandatory code for the dairy industry, introduced in 2020, had addressed some issues in the sector, Mr Forbes said.


"It just made a big difference to us when we've been negotiating with some of the companies," he said.


"The code is not a panacea for all industries.


The desire for supermarkets to increase their profit and market share at expensive farmgate price is still is illustrative of the ongoing issues confronting dairy farmers."


A separate inquiry carried out by former Labor minister Craig Emerson is examining whether the grocery code should be made mandatory.


Outside the hearing, Independent MP Andrew Gee and Queensland MP Bob Katter held a press conference accusing the major parties of inaction on supermarket pricing.


Woolworths and Coles face claims of price gouging by producers and consumers.


The MPs stood alongside staffers dressed in inflatable pig costumes holding a banner saying: "Stop supermarket hogs and National Party porkies!"


Nationals Senator Ross Cadell watched on, accusing Mr Gee, who sensationally quit the party in 2022, of being a "stunt man".


"You did nothing when you were a Nat because all you're about is the stunts," Senator Cadell said.


Mr Katter then accused Senator Cadell of playing politics.


The exchange became heated when Mr Katter approached Senator Cadell and told him to stop interrupting.


"Now, shut up," Mr Katter said, pointing his finger at Senator Cadell.


Mr Gee said the independents on the crossbench and Mr Katter would introduce a bill to cut back the power of the major supermarkets and limit their profits on fruit and vegetables.


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