As people dig further into their pockets at the checkout, they’ve started looking for answers on why prices keep rising. They’re not the only ones, our political leaders agree it’s worth investigating.
So, when the Federal Government announced last week the consumer watchdog, Australian Competition and Consumer Commission (ACCC) would investigate supermarket prices and competition, the news made national headlines.
National Farmers’ Federation President David Jochinke said farmers were definitely questioning why the gap between what they get paid and what produce ends up on supermarket shelves for keeps widening.
Things came to a head late last year when farmers went from getting on average $10 per kilo for a sheep down to about $4, but there was no change in price at the supermarket.”
Farmers weren’t impressed and neither were consumers who were already bowing under the cost of living crunch.
We particularly felt food price inflation in the quarter to September 2022 when fruit and vegetables jumped by 16.2%.”
While food prices have since steadied thanks to better growing conditions, latest figures from the Australian Bureau of Statistics show we are also feeling price pain from rises in insurance, transport and, of course, housing.
While people are looking squarely at the end of the supply chain, the supermarkets, and whether they are price gouging, Mr Jochinke wants to see a lens put over the entire food supply chain.
“There’s a lot of players in the middle between the farmer and supermarket. There’s just no transparency in the supply chain on who’s clipping the ticket, if there’s any problems pushing costs up and what efficiencies we can improve upon – for example are the poor conditions of roads adding to transport costs?
“There’s also work that can be done to improve our competition laws in Australia where we have a highly consolidated market – there’s just not many places growers can sell their produce to.
“This means farmers have limited options to shop around and find a better price and it also puts consumers in the same boat.”
Reduced margins were one of the reasons 34% of growers told AUSVEG last year they were considering leaving the industry.
The ACCC inquiry isn’t the only one looking at food prices, there are numerous other inquiries happening at the moment, such as the Food and Grocery Code Review and a Senate inquiry.
“Farmers are pleased these inquiries are happening, but there’s no silver bullet. The ACCC inquiry alone is a 12-month investigation and we’ve seen before how reports and recommendations sit on shelves in Canberra, collecting dust.
“Australians need to see some real change and fairer and more transparent markets are a good place to start.”