Food for thought

That no season is the same as the last one is one of the few certainties in farming.
What Australian growers produce and what it sells for are highly sensitive to the vagaries of the weather, market supply and demand and the performance of the Australian dollar.
For fruit and vegetable growers, this year has delivered an abundance of high quality fresh produce with an Aussie dollar that makes exports tough.
There’s an oversupply of produce on our domestic market and the unlikely white knight riding in to save our farmers is one of the nation’s biggest supermarkets.
Coles is capitalising on the produce boom by using it as its latest battlefield in the price war against fellow grocery giant Woolworths.
It is buying up low-cost fruit and vegetables and passing the savings on to customers as a way to push large volumes of produce through the supply chain, so growers are not forced to leave their crops to rot.
It is admirable that one of the two major corporations that dominate our food sector wants to support the nation’s farmers, but let’s not forget Coles is also making the most of a market situation to win some public relations points in its war against Woolworths.
While growers and the State’s biggest wholesale market support low prices during an oversupply, they are understandably jittery about what Coles’ new pricing strategy means for their future.
The duopoly’s cut-throat battle for supermarket dominance has already targeted bread, milk and meat and Australian farmers are wondering how long the chains will continue to absorb the losses from reduced prices.
What happens in a few months’ time when the oversupply ends, but consumers are used to paying a lower price for fresh produce?
The industry’s fear is that Coles will refuse to pay a higher rate for fruit and vegetables, choosing to be supplied only by big producers who, through economies of scale, can afford to receive less per product unit.
That could then push smaller growers and the greengrocers and independent supermarkets they supply out of the market.
Worse still, it could pave the way for a flood of produce imports from countries that have lower overheads and can afford to sell the fruit and vegetables cheaply.
That is surely not what customers want if the growing interest in buying local is anything to go buy.
The more than 2000 shoppers that swamped the Mt Pleasant Farmers Market, and the ongoing success of similar markets around the State, shows that consumers want to know where their produce is coming from.

Be the first to comment on "Food for thought"

Leave a comment

Your email address will not be published.


*