Food supplies to be disrupted by floods: SPC

The maker of more than 100 popular supermarket staples such as SPC baked beans, Ardmona canned tomatoes and Goulburn Valley fruits is concerned flooding across Victoria will affect supplies of key produce.

SPC chairman Hussein Rifai on Tuesday said the company had hundreds of suppliers across flood-affected regions, many of whom had been inundated, and about 40 per cent of staff had also faced flooding or power outages.

The latest round of flooding is sparking concerns that fresh fruit and vegetable prices will continue to rise. Dean Sewell

“It’s so wet and so muddy,” Mr Rifai said. “We’re trying to see what else we can do to help them. [Farmers] are pumping water out of their fields to try and get some yield and so the fruit doesn’t rot in the ground.”

The SPC chairman said he was not yet hearing feedback from growers that would give cause for concern about a significant decline in the quantity or quality, but it was still early days.

“You really don’t know until the dust settles. We’re in the middle of the battle now, the water is still receding, and there are a lot of people that haven’t had time to examine their fields.”

Current flooding is the latest in a series of cost pressures to hit the iconic Australian brand SPC, which this year was forced to raise prices due to flooding and higher freight and packaging costs.

Mr Rifai said given everything going on, from wars, supply chain disruptions and regular flooding, no sensible businessman would not be worried. “There are just so many variables that are all negative,” he said.

Farmer groups warned the destruction of key infrastructure would hamper supply of goods in coming weeks, leading to some food shortages.

“We need to be proactive with thinking about how we can get on the front foot and find workable solutions to some of these complex challenges now,” NSW Farmers Grains Committee Chair Justin Everitt said.

The latest round of flooding is sparking concerns that fresh fruit and vegetable prices will continue to rise.

Food inflation is already running faster than expected across fresh and dry grocery foods, according to UBS economists. Food prices stepped up markedly in the September quarter, with fresh food up 9 per cent.

Treasurer Jim Chalmers said Australians should brace for even more expensive groceries heading into the Christmas season.

“This is the unavoidable consequence of some of our best producers being impacted by natural disasters,” Dr Chalmers said.

“We know the price of basic groceries and food will go up and Australians will find it that much tougher when they’re already under the pump.

“There will be a substantial impact on the cost of living, there will be a substantial impact on the budget and there’s no pretending otherwise.”

The outlook comes as Victoria and NSW brace for more flooding events.

As the cleanup effort gets under way in Maribyrnong in Melbourne’s north-western suburbs, fresh warnings have been issued for the state’s north.

“There is more rain on its way by the end of the week, particularly for northern Victoria,” Premier Daniel Andrews said.

“That’ll see renewed water rising and flooding, potentially not exceeding the peaks we saw over the weekend, but still very significant challenges.”

Mr Andrews said 13 aircraft, including military helicopters, would be deployed to survey damage and transport critical supplies to communities that have been isolated by flood water.


Extracted from AFR

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