A new review into the chicken meat supply chain has come as no surprise to farmers waiting on action to address market power misuse in the poultry industry.
Today the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) released the initial findings of its independent review of market failure within the chicken meat supply chain.
The report found that processors are still using their market power to squeeze poultry growers, with more protections desperately needed to stop an exodus of farmers from the industry. It identified a mandatory Code of Conduct as a potential response to the overwhelming evidence of market failure.
"It's pleasing to see the concerns NSW Farmers has raised through this process taken up by ABARES. This report confirms what we all know - that poultry farmers are feeling the effects of market power misuse on an extreme scale, and have been for many years," NSW Farmers' Principal Economist Samuel Miller said.
"Government-funded research has already shown us farmers are struggling with unfair contract terms, little to no choice in processors, and many other conditions that are making it impossible to survive in the industry, let alone thrive."
According to the Australian Bureau of Statistics, NSW has lost 27 per cent of its poultry farms since 2011 due to declining margins. A mandatory code of conduct was essential to protect the growers who remained, Mr Miller said, with the Federal Government urged to implement this code before it was too late.
"Fair trading and fair prices for farmers and consumers will only come if we have a mandatory code of conduct that demands better behaviour from processors within the poultry meat industry," Mr Miller said.
"Farmers need greater powers to negotiate and better enforceability of their contracts - and a code enforced by our nation's competition watchdog would deliver this.
"Chicken is a staple most Aussies are putting in their shopping cart, and ABARES is warning that it could soon become too expensive for families to afford, while our farmers are forced out of business because they're getting nothing in return, and can't do anything about it."
