Emma Standen

Underpaid fresh fruit and veg suppliers believe that the Prime Minister’s inquiry into inflated supermarket prices will not bear fruit. After discussing the issue with a key supplier from North Queensland it was clear that farmers have no bargaining power when supplying the major supermarkets.

Prices are based on supply and demand, when there is a shortage of a product the price increases, and when there is an oversupply, the price drops. For example, cyclone Larry in 2006 wiped out banana plantations along the coast of North Queensland creating a shortage, however inland banana growers were unaffected and therefore had greater bargaining power in ensuring a good price for their crop.

In contrast recently an increase in avocado supply has led to an oversupply causing prices to drop and fruit to be dumped. Supermarkets had the power to dictate the price of avocados regardless of how much it costs to grow.

The supplier highlighted that this fragile balance of supply and demand is a trend only really seen in perishable items such as milk, meat and fresh produce. Referring to growers as price-takers he explained that farmers do not have the option to ask for a higher price for their product because major supermarkets would just take their business elsewhere.

He said that “You can never ask for a higher price because the supermarket can just find someone else to supply them for the price they are asking. It’s just better to agree and get a sale rather than nothing. Its yes sir, no sir, three bags full sir.”

The supplier also grimaced over the prospects of a solution from the announced inquiry into the cost-of-living crisis. He explained that farmers feel like politicians are out of touch with the public, referring to interviews from the last federal election where both Anthoney Albanese and Scott Morrison were unable to answer questions about the price of everyday items like milk and fuel.

“It is obvious that they [politicians] pay someone else to do their errands and look maybe the inquiry will hand down some findings, but the government probably won’t legislate any of it” he said.

When asked about boycotting his response was that it was not the solution to this problem because it would harm producers well before it would harm supermarkets. Unless consumers were able to find affordable alternatives to major supermarkets there isn’t much, they can do to create a change. The supplier exclaimed that this is a systemic problem greater than just one chain of supermarkets. It is the mentality of politicians, consumers and of course the supermarket duopoly that has realised that they can charge whatever price they like at the checkout.

For further reading check out: The Great Supermarket Heist: Coles and Woolworth Under Fire for Alleged “Price Gouging” – The Griffith Journal (wordpress.com)