News and Reviews
Fear factor in fresh food supply
Fear factor in fresh food supply
A government report has revealed farmers are afraid to speak out on their dealings with the major supermarkets because of a “fear of retribution”.
NSW Farmers Dairy Committee Chair Colin Thompson said the disappointing findings from the inaugural Food and Grocery Code review vindicated the efforts to secure fairness in fresh food supply chains.
“The majority of pay rise negotiations were fruitless for farmers in 2021 and almost a third of major supermarket suppliers cited ‘fear of retribution’ as a reason for not raising issues under the Code,” Mr Thompson said.
“Something is clearly wrong when people are afraid of having their say, and it’s clear that many farmers won’t raise concerns or ask for improved pay arrangements because of how powerful these supermarkets are.”
While Mr Thompson commended Coles and Woolworths for complying with the Code’s voluntary reporting regime, he said there was clear room for improvement in fresh food supply arrangements.
“The perishability of their produce basically means farmers are price-takers and are in a vulnerable position in their supply chains,” Mr Thompson said.
“This dynamic can give rise to abuse of power by bigger players, such as wholesalers and retailers.
“However, we do need to recognise there was some positive feedback, particularly for Aldi.”
Mr Thompson said NSW Farmers had been pushing for change in this space and had a key breakthrough with the Perishable Agricultural Goods (PAG) inquiry and its subsequent findings in late 2020.
“NSW Farmers has advocated for intervention to make supply chains such as dairy, horticulture and poultry meat more equitable – essentially so that farmers can receive the pay they deserve for their produce,” Mr Thompson said.
“Our advocacy led to a Treasury-led ACCC inquiry, which confirmed power dynamics are likely to favour wholesalers, processors and retailers, and the ACCC made a suite of recommendations to help remedy this situation.
“We need firm commitments for legislative reforms to protect farmers from unfair trading practices.”
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