Woolworths and Coles have spoken out on claims they are raising fresh produce prices amid rising cost of living.
Australia’s supermarket giants are at the forefront of criticism following statements by NSW Farmers Horticulture Committee chairman Guy Gaeta who says retailers are to blame for soaring fresh produce prices.
“It’s not against the law, price gouging…but it is [fresh produce] an essential part,” Mr Gaeta told Yahoo News Australia. “It’s sad. There are families passing by [the produce aisle] and say, ‘I can’t afford it’.”
Mr Gaeta, a third-generation apple and cherry farmer from Orange, NSW, explained that farmers are not benefiting from price hikes for produce sold in supermarkets.
“If farmers got $10 for a lettuce, we’d be driving Ferraris,” he said.
Mr Gaeta cited systematic competition failures in Australia and accused supermarkets like Woolworths and Coles of pushing small greengrocers out of business, as well as manipulating farmers to get the lowest possible price for produce without anyone doing anything about it.
He added that farmers bear the cost of delivering produce to distribution centers.
“They also have costs, but we don’t put 80% on top of the agreed price. We [farmers] don’t scam anyone.”
Woolworths and Coles respond
Both Woolworths and Coles have hit back at the allegations, saying they are committed to delivering value to customers, particularly at a time when household budgets are a priority.
“There’s no escaping the cost of living,” a Woolworths spokesperson told Yahoo News, citing that pushing prices up, especially up to 80%, would be like “shooting yourself in the foot”.
The spokesperson added that even though profit margins are very tight in the industry, it is still in their interest to ensure the industry thrives.
In a separate statement to Yahoo News, a Woolworths spokesperson also clarified that fruit and vegetable prices are determined by what they pay farmers.
“We pay farmers the market price for their produce, which can vary throughout the year due to weather, seasonality, supply and demand. Last year, when the market price for fruits and vegetables was down, we passed those savings on to customers in the supermarket,” the spokesperson said and added that they currently pay much more to suppliers of the vegetable category.
“The main reason prices are up on some varieties is reduced supply in the market, following East Coast flooding and persistent bad weather in key growing areas,” the carrier said. word of Woolworths. “We operate in a highly competitive market and always strive to strike the right balance so that suppliers receive a fair market price and our customers have access to affordable fresh produce.”
Rival Coles also underlined its aim to reduce costs for families amid inflationary pressures.
“We appreciate that there are a number of factors driving inflation for all retailers, including rising raw material costs, rising energy prices, transportation costs, extreme weather events and the ongoing impacts of Covid,” a spokesperson for Coles told Yahoo News.
“We are committed to continuing to build strong, multi-generational and collaborative partnerships with Australian farmers and growers, including long-term contracts, which is why so many farmers want to work directly with Coles. These partnerships allow us to source directly from suppliers. and help us ensure fresh produce at great value for our customers. »
“The price of products is a factor of supply and demand; however, our team is working hard to bring prices down for our customers as quickly as possible. Our customers can expect to see an improvement in the volume of many fresh produce lines in the coming weeks thanks to the extraordinary efforts of our growers.”
Food and Grocery Code
Woolworths and Coles are also bound by a food and grocery code regulated by the Australian Competition and Consumer Commission (ACCC).
The code, which is voluntary, was introduced to improve standards of business conduct in the food and grocery sector. Woolworths and Coles were among the first code signatories, along with German retailer Aldi.
In a statement to Yahoo, Australian Retailers Association CEO Paul Zahra weighed in on the matter.
“Retailers are working hard to keep prices affordable for customers in the face of intense challenges. The supply of some fruit and vegetables has been affected by adverse weather, including recent flooding in northern New Wales du South and Queensland. This is on top of the inflation impacts, rising energy costs and supply chain constraints that many businesses continue to face,” Zahra explained.
“Companies are doing their best to absorb market fluctuations as best they can and are working hard to ensure their inventory is healthy and consumer prices remain affordable.”
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