Tasmanian farmers did not feel there was a “sense of justice” in their ability to be paid fair prices for their produce by the major supermarkets, Woolworths and Coles, which would let them make a decent return on the risks they take.
Nathan Calman, chief executive of peak agricultural group TasFarmers, told the Greens-led Senate inquiry into the supermarkets that farmers felt the current supermarket and market dynamics were “very unbalanced” and that they were worried about their future, their businesses and the ability for the nation to grow and supply its own food.
This was driven partly by the pricing pressure on farmers.
“The overwhelming sense is they don't feel a sense of justice in their ability to recover a fair price for the risk they take and products they produce,” Mr Calman told Senators at the first day of hearings in Hobart, Tasmania.
Mr Calman said primary producers were being hurt by rising input costs that couldn't be then passed on to customers, which were the supermarkets.
He said his members were “too scared to speak up” when complaining about the behaviour of the supermarkets.
In other evidence, the nation’s leading supermarket chains moved heavily into butchery and cheap meat in the 1960s and 1970s, offering meat at a loss in some circumstances, which put many independent butchers out of business.
Australian Beef Association chief executive David Byard, appearing before the Senate inquiry, said there was a time when the suburbs all had many independent butchers but most of them had gone out of business.
Mr Byard also said it was nonsense as claimed recently by a senior Woolworths executive that the supermarket had to buy the whole carcass from growers and lost money on parts of the animals that couldn't be sold for food.
George Mills, a Tasmanian meat and vegetables grower who was sitting next to Mr Byard as they both testified before the Senate inquiry, said growers didn't get paid for large segments of the carcass whereas in the US for example there was much more transparent pricing for sections of the animal not sold ultimately to shoppers.
Mr Mills said it wasn’t just pricing that could squeeze farmers but also that the supermarkets operated incredibly strict grading rules for agricultural products that could “ruin” and “bankrupt” farmers.
He said these grading systems are applied after contracts are signed.
“Grading systems suddenly apply” he said, and that can knock out shipments of vegetables for example with farmers left holding the stock.
