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Farmers develop mandatory code of conduct to fight supermarket price war and price gouging

September 24, 2013 • News

A mandatory code of conduct to prohibit price discounting brought about by the price war between the major supermarkets is being developed by agricultural lobby groups from four states.

Image credit: Free Digital Photos user Detanan

Image credit: Free Digital Photos user Detanan

ABC News reported this morning that farmers from New South Wales, Victoria, Western Australia and Queensland have established a committee that will push for the implementation of the code of conduct.

The committee’s farmer representative Peter Darley said the market monopoly by Coles and Woolworths is causing a lot of farmers to get ripped off.

“They’re forgetting about the farmer. He’s the guy that’s taking all the risk, producing all that product and hoping that he’s going to get a fair price for his cost of production,” said Darley, who is an apple grower from NSW.

“You know, the dollar a litre for milk, that’s had a huge impact on the dairy industry. It’s under the cost of production and you just can’t maintain those sorts of prices.”

The Australian Competition and Consumer Commission (ACCC) is also looking into the allegations of improper behaviour by supermarkets and is yet to decide whether measures will be taken, according to the report.

The Australian Food and Grocery Council says producers’ costs are being pushed up by 6 percent due to the price discounting.

However the Australian National Retailers’ Association’s Margy Osmond said the farmers and suppliers are not being unfairly treated.

“There is an assumption I suppose that the relationships aren’t good ones and I would heavily dispute that because there are a enormous number of farmers who have long-term relationships with the supermarkets,” she said.

Still, Mr. Darley said the code of conduct should be followed by everyone involved in the supply chain because voluntary codes being lobbied by supermarkets are never effective.

“We have a mandatory code there that is not effective even at this stage until it gets more teeth in regards to reforms because if we don’t you’re going to lose more farmers,” he said.

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