Coles boss Leah Weckert says sector ‘very vigorous’ ahead of ACCC findings

Leah Weckert has defended the competitiveness of the $120bn supermarket sector ahead of an ACCC report that could be used by the Albanese government to win votes at the looming election.

Visy chairman Anthony Pratt gave the keynote speech at The Australian's Global Food Forum in Melbourne on Friday. Trade Minister Don Farrell and Coles chief executive Leah Weckert were also in attendance.

Coles chief executive Leah Weckert says the supermarket is competing in a “very vigorous” playing field, underlining the competitiveness of the $120bn sector as it braces for the release of the competition regulator’s report into the industry.

Ms Weckert, speaking at The Australian’s Global Food Forum on Friday, said she believed the Australian Competition and Consumer Commission findings, expected to be released as early as Monday, could tighten regulation around transparency of contracts with food producers – particularly around price and volume – as well as lead to better customer signage around changes to packaging sizes and shelf prices.

Delivering the forum’s keynote speech, Visy chairman Anthony Pratt said the country’s food exports were booming, doubling from $30bn to $60bn a year.

“We’re also diversifying into new international markets, with 70 per cent of our farm production sold from 169 markets,” he said.

The Australian editor-in-chief Michelle Gunn, in her opening address, said the forum – now in its 13th year – was unapologetically about promoting prosperity.

Supply risks, rising production costs, regulatory burdens, the impact of climate change and the energy transition were among the challenges facing the nation’s agriculture sector, Ms Gunn said.

“These challenges demand decisive government policy, strategic investments and long-term vision,” she said.

Ms Weckert cautioned against heavy handed regulation that could stymie productivity and, rather than helping households with cost-of-living expenses or suppliers with improved supermarket relationships, heap more costs on retailers that would eventually be borne by consumers and producers alike.

The ACCC’s final report is in the hands of federal Treasurer Jim Chalmers.

The growing fear, especially among the twin supermarket giants, is it will be used by the federal government as a political weapon in the lead-up to an election campaign where cost of living will be a dominant issue and in which the supermarkets are easy targets. Ms Weckert, who gave testimony at the ACCC’s public hearings late last year, said Coles competed with a range of local and international retailers, which together created a highly competitive supermarket sector.

“The level of competition, that was a big topic at the public hearings and we believe that the competition in the grocery sector in Australia is very vigorous,” she told the Forum in Melbourne.

“You have obviously got the three Australian supermarkets in Coles, Woolworths and the Metcash network, but you have also got three very large local players in Aldi, Costco and Amazon and the three of those are in the top 10 of retailers globally, we don’t even feature in the top 50.

“And so you have got big global players who are coming in, and in the course of the last 15 years or so have pretty substantially come to this market.”

The “very vigorous” nature of the supermarket sector was a key line of defence used by Coles and Woolworths through their interactions with the ACCC inquiry, but the regulator and the government may be unconvinced.

Ms Weckert said new rules around supplier relationships could be a key thrust of the findings. “I think the other big topics will probably be supply relations,” she said. “And so I think there’ll be some recommendations, particularly around fresh produce and getting more transparency for producers around price and volume.”

Coles chief executive Leah Weckert said Australia has a “very vigorous” playing field of supermarket rivals fighting for shoppers’ attention.

A key complaint from farmers and suppliers to the ACCC inquiry was the sometimes vague contractual certainties around the supply of produce.

Its interim report published in 2024 said Australia’s supermarket industry was highly concentrated, and many shoppers felt they were penalised if they did not have access to loyalty or member pricing. Ms Weckert anticipated more regulations about the in-store display of prices and changes in packaging sizes, known in the industry as “shrinkflation” when the weight or volume of an item reduces but the price stays the same.

“So potentially recommendations to put out signage ... to indicate a product has gone through shrinkflation. We may need to have certain minimum font sizes for pricing, publishing prices online, those types of things to make it much easier for the customer to compare prices across retailers, but also find value.”