Farmers Want to Know Who Gets the Money

Farmers want to know who gets the money

Opinion Editorial in The Newcastle Herald

Published: 24 April 2008

by

Charles Burke

Vice-President

National Farmers’ Federation

CONSUMERS – increasingly attuned to rising food bills – are justified in wanting to know what is driving higher food prices.Likewise, Australian farmers are just as eager for the Australian Competition and Consumer Commission (ACCC) to get to the bottom of where the money is going.

There is clear evidence of an ever-increasing disconnect between what NSW farmers are paid at farm-gate and what consumers from Sydney to Newcastle and further afield are charged at the check-out.

In truth, farmers only ever receive a miniscule portion of what consumers pay – in some cases as little as 5 per cent – so what’s going on in the middle?

The ACCC must use the powers of its‘Inquiry into the Competitiveness of Retail Prices for Standard Groceries’ to examine the entire supply chain from farm-gate to check-out so we can all – consumers and farmers, alike – have confidence in the competitiveness of getting food from the paddock to dinner plate.

And, should there be a breakdown in competition within the supply chain, we need to be able to identify it, isolate it and ensure that those sectors are held accountable for any price gouging.

As farmers, we are acutely aware – and we are making the ACCC mindful – that the intent of this Inquiry is not simply to reduce retail prices. Such a simplistic knee-jerk reaction to reduce costs at the expense of what farmers get paid misses the point.

Farmers, as price-takers, must not be further squeezed financially in producing fresh, high quality, environmentally-sustainable and value-for-money food.

The ACCC needs to shed light on the lack of transparencyalong the complete supply chain to ensure there is adequate competition and fairness and make doubly sure farmers are not made the bunnies of any price reductions at the retail end.

Our farmers – in producing the safe, carbon-friendly food production, which accounts for 93% of food on retail shelves – are entitled to a fair return on what they produce and how they produce it.

Good news seldom gets much play, but our farmers lead the world in agricultural innovation, creating and implementing cutting-edge technologies and new environmentally-sustainable farm systems.

For example, while Australian farmers have doubled their productivity over the past 14 years, they have done so while leading Australia in reducing primary industry carbon emissions by 40%.

Consumers, in turn, need to be aware that the costs involved in producing food – especially when we’re implementing consumer-driven demands such as carbon sensitive farm practices – ultimately, result in higher prices.

Now, more than ever before, consumers are demanding products meet new standards. That is, not only guaranteeing product safety and quality, but also commitments to the integrity and ethics of production system.

This requires short, responsive and accountable supply chains and is a break away from the supply driven commodity model that has characterised Australian agriculture in the past.

In the face of climate challenges, consumers are demanding even more environmentally-sustainable production, through growing expectations that products, including food, will leave a reduced carbon and water footprint into the future.

The ACCC’s Inquiry must give farmers and consumers a full account, and clearer picture, of where their hard earned money is going.

[ENDS]

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