Key points:
- Potato growers supply Australia’s fresh and frozen food sector year-round
- As production costs soar, growers say their returns are no longer sustainable
- Crisis meetings are underway between farmers in key growing regions of Australia
Potato farmers in key growing states say unless supermarkets add 20 cents per kilo to the shelf price of their produce, departures from the industry will be inevitable.
Farmers across all sectors are grappling to absorb production price increases of 50 per cent and beyond brought on by global factors including the war in Ukraine and exponential surges in fuel, fertiliser and on-farm maintenance costs.
Potato growers are generally tethered to a price agreed to with processors prior to harvest and as a result their returns do not fluctuate as demand or check-out prices for their produce increases.
The situation has prompted them to advocate for wholesale and supermarket buyers to consider an urgent price review.
‘Simply a necessity’
Potato farmers in the West Australian growing region of Busselton have begun a public awareness campaign to shore up public support as they push for supermarkets to add 20 cents a kilo to offset the spike in production costs.
Third generation grower Keith Taylor described the push as essential.
“We are all very aware consumers are already being hit with price hikes on the essentials, but our situation is no longer sustainable,” Mr Taylor said.
“Our production costs have already shot up 17 per cent since October and some of those costs are going up on a weekly basis — it shows no sign of decreasing.
“It’s simply a necessity.
“We have growers on the verge of leaving and it will be inevitable that some will unless we can be heard.”
Fellow Busselton farmer Darryl Smith said the increased price of diesel had seen his fuel bill for a return trip to Perth – where he delivers potatoes several times per week – jump from $230 to $450 in 12 months.
“It’s not limited to fuel though — everything has gone up,” he said.
“Costs of repairing the truck, freight costs have gone up and the cost of labour has gone up, which is why I’m now driving the truck to Perth myself.”
Growers in Busselton are holding regular meetings to discuss a path forward while also monitoring each other’s mental health.
“I would not say the mood is good,” Mr Taylor said.
“If you were to take a cold, hard long look at it from the point of view of an accountant, it is difficult to make a case to continue.”
‘We all need to chip in’
Tasmanian potato growers supply a large portion of what is used in Australia’s takeaway and frozen food sector, including products like chips and wedges.
Grower Leigh Elphinstone said discussions with processors were underway, but he urged shoppers to be cognisant of the external forces prompting their push for a price increase.
He said Tasmanian growers shared the sentiment held by their counterparts in WA.
“We need to sell our story, explain where we are coming from and the issues that we are dealing with,” Mr Elphinstone said.
“These factors are out of our hands.
“Things like the wild weather events we have been experiencing — over the past 10 years every record has been broken, be it the wettest year, driest year, coldest, hottest.
“These extremes are definitely coming into play.
“We have to educate the consumer that we are all in this together and if we want the best quality food, we all need to chip in and help each other through it.”
Search for middle ground
AusVeg national public affairs manager Tyson Cattle said data revealed prices for fresh vegetables had risen by more than 7 per cent over the past two years, while production costs had risen by 35 to 45 per cent in a similar, if not shorter, period.
Mr Cattle said discussions were underway with wholesale and supermarket buyers to “strike a balance” between maintaining supply and equitable return for growers.
“Historically, fresh produce growers have been price takers,” Mr Cattle said.
“Everybody is cognisant of the challenges that exist out there — however, we need to find some middle ground in terms of what is a reasonable price for the consumer, maintaining that demand while also ensuring that growers receive a fair price.”
Landline contacted several of Australia’s largest supermarket buyers and processors.
A Woolworths spokesperson told the ABC that it had engaged in “collaborative conversations about our price with our regular suppliers over the last six months, taking into account cost pressures driven by inflation”.
“We’ll continue to to work closely with our suppliers to understand variations in the market and collaboratively manage industry-wide challenges,” they said.
Extracted from ABC
