Coles Implements Aggressive Price Reductions, Prime Minister Urges Further Action

Coles Implements Substantial Price Reductions on Meat Products Amid Accusations of Unfair Pricing Practices

Coles has taken decisive action by reducing prices on beef steaks and lamb chops by over 20 percent, aiming to address accusations that major supermarkets have failed to pass on cost reductions to farmers. The move comes amid government warnings of potential intervention into supplier relationships.

In an effort to offer lower prices, Coles has committed to a three-month price reduction on more than 300 products, spanning meats, deli items, seafood, as well as non-food items like dishwashing tablets and tea bags. This announcement coincided with official inflation data revealing the slowest price growth in nearly three years, partly influenced by declines in certain supermarket staples.

Advertisements

Andy Mossop, Coles executive, expressed the company’s commitment to providing immediate value and lower prices, emphasising the evolving needs of their customers.

Prime Minister Anthony Albanese contended that supermarkets need to do more to ensure that reductions in wholesale prices are adequately transferred to consumers.

However, Prime Minister Anthony Albanese contended that supermarkets need to do more to ensure that reductions in wholesale prices are adequately transferred to consumers. He highlighted the government’s intention to monitor this issue closely.

Recent inflation figures for November unveiled mixed trends, with some grocery prices rising (e.g., eggs, bread, and beer) and others experiencing substantial decreases, such as lamb (-15.5 percent), beef (-4.2 percent), and vegetables (-0.2 percent).

Responding to concerns over pricing practices, the federal government has appointed former competition minister Craig Emerson to lead a review of the grocery industry’s voluntary code of conduct with suppliers. Dr. Emerson acknowledged the Farmers Federation’s call for a mandatory code overseen by the Australian Competition and Consumer Commission, indicating this as a live consideration in the review.

While ruling out price caps, Dr. Emerson stressed the importance of following the evidence in the review process. Simultaneously, a parliamentary inquiry led by Greens Senator Nick McKim is set to scrutinise supermarket practices.

Despite criticism, Coles and Woolworths, with a combined revenue of $104.7 billion for the 2023 financial year, shielded consumers from the worst meat price spikes during the pandemic. Although both supermarket giants reported healthy profit margins, analysts noted their role in mitigating price fluctuations during challenging periods. Woolies’ supermarket division achieved a 6 percent margin, the highest in a decade, while Coles supermarkets maintained a strong margin of 4.8 percent.

For more rural news, click here.