Farmers have welcomed a renewed focus on the fresh food supply chain by the competition watchdog.
NSW Farmers Vice President Xavier Martin said it was pleasing to see the issue raised by outgoing Australian Competition and Consumer Commission Chair Rod Sims at the National Press Club of Australia, and fresh food producers were continuing to ask the Australian Government to implement recommendations from a watershed ACCC inquiry in 2020.
"The perishable agricultural goods inquiry was a breakthrough moment for fresh food farmers, many of whom face eroding competition in their supply chains," Mr Martin said.
"Australia has an incredibly concentrated supermarket sector, and there's numerous examples of how this has enabled dominant retailers to perversely influence the market value of popular food items.
"There's increasing evidence of the power being wielded by intermediaries such as processors, and this reality was recognised by Mr Sims in his address, where he acknowledged the comparatively weak position of farmers in supply relationships."
Mr Martin said meaningful change was needed to create more equitable supply chains where farmers were being adequately rewarded for their work.
"Fresh food farmers are typically price-takers due to the perishability of their raw product and the geographic need to contract to local processors, but there's typically few processors to choose from," Mr Martin said.
"There's mounting evidence of farmers accepting contracts containing unfair terms because they lack alternatives.
"What's more, the low retail price on fresh food items affects profits flowing down these supply chains, and intermediaries are often in a position to pass on this risk."
Mr Martin said he hoped Mr Sims' comments, where he reiterated the need to bolster protections for farmers, were an indication of things to come despite the chairman's resignation.
NSW Farmers will be highlighting supply chain concerns in a submission to the NSW Parliamentary inquiry into food production and supply in New South Wales.
