Farmers accuse supermarkets of ‘ripping off’ consumers

Key points:

  • Retailers have blamed inflation for the rising cost of fresh produce on supermarket shelves
  • With no increase in farmgate prices, farmers have accused supermarkets of price gouging
  • Apple growers have been struggling to turn a profit due to increased production costs

Farmers say they are not benefiting from any price-rise of fresh produce at supermarkets, amid accusations that retailers are price gouging.

NSW Farmers Horticulture Committee chairperson Guy Gaeta said supermarkets were pocketing extra profits made through price rises.

“People are paying more for their fruit and veggies at the supermarket, but the farmers aren’t selling them for more, so who’s really raising the prices here?” he said.

“Sure you’ll get a little lift in prices because of the cost of fuel, but not like we’ve seen at the checkouts recently.

“They’re ripping off the farmer and they’re ripping off the consumer.”

Dave Parsonage is a fruit and vegetable farmer near Condobolin in central-west New South Wales.

He and his wife Diane were often shocked by how much the supermarkets marked up prices.

“It’s atrocious, a lot of it,” Mr Parsonage said.

“Iceberg lettuces were $3.80 [at the] Flemington markets [but they were] $7.50 in IGA, $6.90 at Coles.”

A ‘failure’ of competition laws

NSW Farmers president James Jackson said the issue stemmed back to the “ongoing failure of Australian competition laws”.

“Any of those highly perishable goods are at the mercy of the supermarket duopoly,” Mr Jackson said.

“We’ve suffered for years due to poor competition policy in this country and it’s got to be fixed.

“My challenge to all the parties in this election is, ‘Let’s do something about it’.”

Retailers blame inflation

But Australian Retailers Association (ARA) chief industry affairs officer Fleur Brown blamed the price rises on inflation and supply chain issues.

“For at least the next 12 months, we are expecting inflation to have an impact unfortunately, so we do need to brace ourselves for some price rises,” she said.

She said accusations of price-gouging were not true and supermarkets were seeing a drop in profits as well.

“Woolworths reported a reduction in its profit margin in Australian food most recently from 5.7 per cent to 5.1 per cent,” Ms Brown said.

The company recorded a $1.79 billion net profit result in the 2021 financial year.

Apple growers struggling

Many apple growers have said it has become increasingly hard to receive a profit on their produce.

John Evans is selling part of his Geeveston farm, south of Hobart, off the back of shrinking margins and flat demand, especially for older apple varieties.

He said his returns were unlikely to be good enough to continue.

“We took a 40 per cent pay cut last year,” the sixth-generation orchardist said.

“How many times can we do that?”

Calls for a pricing review

Fruit Producers South Australia chief executive Jose Gil said the state’s apple growers had been struggling to break even amid the rising cost of production.

Mr Gil said he would like to see more transparency and supported a review into produce pricing.

“There certainly needs to be a review [to] make sure that the growers are actually … getting the money that they need to be able to continue to provide produce,” he said.

“Otherwise we’ll be looking overseas for produce and that’s the last thing we need in this country.”


Extracted from ABC

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