Shadow Agricultural Minister David Littleproud has called for an investigation into sky high supermarket prices, as it is revealed that farmers are selling stock for significantly lower prices now than 12 months ago, while supermarket prices remain the same.
Littleproud requested the inquiry from the Australian Competition and Consumer Commission (ACCC) after prices at supermarket shelves did not fall following lower costs from farmers, who are being paid significantly less for supply.
“According to Meat and Livestock Australia, some sheep and lamb categories have fallen by up to 70 per cent in the saleyards in the last 12 months,” he said in a statement.
“Lamb prices have drastically reduced and cattle prices have fallen by about 60 per cent. Yet families at the supermarkets have barely noticed a difference in prices.”
Whereas Labor has already established a competition taskforce to review the industry, this will take place over a two-year period. Littleproud said an “urgent response” was needed as “families can’t afford to wait potentially two years for answers”.
He said unlike a review, the ACCC would have greater power to act and bring prices down.
The call comes at a time when supermarkets are posting record profits during a cost-of-living crisis. In August, it was reported that Coles and Woolworths recorded profits in excess of $1 billion with a nearly 5 per cent increase on the previous year.
The ACCC respond to David Littleproud
Speaking to PEDESTRIAN.TV, the ACCC said it was aware of reports over price discrepancies, but that past attempts to regulate prices have proven “disastrous”.
“Grocery prices have been impacted by various factors, including supply chain disruptions, increasing prices of fuel and energy, high transport costs, labour shortages, poor weather conditions and significant weather events, and high international demand for some products placing additional pressure on domestic prices,” a spokesperson said in a written statement.
They said that whereas they have conducted market studies, the ACCC did not have powers to regulate pricing in the agriculture sector.
“Past attempts to impose regulated pricing in agriculture, such as the Wool Reserve Price Scheme, eventually had a disastrous direct impact on farmers, and also stifled innovation and productivity, reducing the global competitiveness of the sector.
“Australia’s recent success as a major agricultural exporter is very much dependent on the competitiveness of the sector, which would inevitably be put at risk if prices were to be regulated.”
However, the commission has made recommendations calling changes to government policy.
“The ACCC has, in a number of inquiries and market studies, made recommendations about the need for more price transparency in agricultural supply chains from downstream participants such as food processors.
“This is particularly important in concentrated markets.”
Ultimately however, they said that whether a price inquiry now goes ahead is a question for the government.