Supermarket senate inquiry: Australian horticulture at tipping point

Woolworths and Coles have behaved “unethically” say Fruit Growers Victoria leaders, in evidence to the supermarket senate inquiry.

Pricing transparency is needed to keep fruit growers in business, horticultural leaders says, labelling supermarket behaviour “unethical”.

Fruit Growers Victoria grower services manager Michael Crisera gave a damning assessment of Woolworths and Coles to the Senate Select Committee on Supermarket Prices on Wednesday afternoon.

Alongside FGV chairman Mitchell McNab, Mr Crisera called for the Australian Competition and Consumer Commission to be granted greater powers to redress the grower-retailer relationship.

“Current codes of conduct are not working,” Mr Crisera said.

“Growers are unwilling to report issues; enforcement is rare and noncompliance is widespread.

“There needs to be a strong regulatory framework for cracking down on unethical behaviour, price transparency for growers and the opportunity for collective negotiations.

“We know that there is an abuse of market power by supermarkets. A limited number of buyers is part of the problem and it is compounded by a lack of price transparency and the fact that our growers sell a perishable product.

“The result is often growers are forced to sell their fruit for below the cost of production, under threat of spoiling fruit or later retribution.”

Mitchell McNab and Michael Crisera from Fruit Growers Victoria at a senate hearing on supermarket prices in Melbourne on Wednesday. Picture: NCA NewsWire /Brendan Beckett

The role that supermarkets played in shrinking Australia’s milk pool was also canvassed in the select committee’s afternoon session.

EastAUSmilk president Joe Bradley said despite the end of dollar-a-litre milk four years ago, Coles and Woolworths were still doing little to give dairy farmers a financial fair go.

“This country has to decide — do we want to grow our own food,” Mr Bradley said.

“Production is falling, dairy farmers are leaving in droves.

“As a friend said to me: ‘There are easier ways to lose money than be a dairy farmer’.”

Mr Bradley said Woolworths had been egregious in its undercutting of Australian dairy with its Hillview cheese line, which uses green and gold packaging.

“There’s a New Zealand cheese that’s been sold by Woolworths that’s packaged in green and gold. That means Australian to most people,” he said.

“If that isn’t bad behaviour, I don’t know what is.”

EARLIER TODAY

More than a third of vegetable farmers are looking to exit the industry, Australia’s horticulture leaders say.

AusVeg chief executive Michael Coote and the group’s chairman, Gippsland farmer Bill Bulmer, were key industry witnesses at a Melbourne hearing of the Senate Select Committee on Supermarket Prices on Wednesday.

Mr Bulmer said the behaviour of the supermarket giants Woolworths and Coles had contributed to a margin squeeze that was leading farmers to exit the industry.

His concerns echoed the submissions of a trio of orchardists who appear in front of the select committee at a Tuesday session in Orange NSW.

“Since the pandemic, we’ve seen floods, fires, earthquakes — anything Mother Nature can throw at us,” Mr Bulmer said.

“In my travels around the country, I’ve never seen the industry in such a low point of despair.

“If we keep going down the path we’re going, we’re not going to keep or entice people into horticulture or agriculture generally. Supermarket conduct plays a role, certainly.”

AusVeg chairman Bill Bulmer.

Mr Bulmer said horticulturalists “kept the shelves full” during the Covid years of 2020 and 2021, yet fruit and vegetable retail prices had not kept up with the pace of input inflation.

Last year, AusVeg conducted a survey of its members with 34 per cent of growers contemplating leaving the industry due to the cost pressures and trading environment.

The horticultural group recently conducted a follow-up survey which showed that figure had lifted to 37 per cent.

“The average age of a farmer in our industry is in the mid 60s, so that means there’s a lot more that are older that are still working. So there’s a big demographic issue right there,” Mr Coote said.

“Our surveys show over a third of vegetable farmers are looking at exiting the industry and that figure is increasing.”

Mr Coote said it was harder to attract the new generation of horticultural farmers due to low pricing.

“The economics of starting a vegetable farm do not stack up,” he said. “We’re unlikely to see new entrants (young farmers) move in, and as a result, we’ll become reliant on imports from countries that don’t have the same food standards that we expect here in Australia.”