Farmers are facing severe financial pressures driving many from the land.
PRIMARY producers around Australia are getting the lowest prices in living memory for their produce and many are being driven from the land.
The importation of food, increased competition, deregulation and oversupply in some lines has hit producers hard. Some simply cannot make ends meet.
An investigation has also found the supermarket juggernauts are pricing growers’ goods at up to 10 times the amount they are paid for them at the farm gate.
Ann Eggart with her sons Jimmy (l) and Billy on their Oxhill Organics farm in Wauchope … beyond the idyllic image of rural life, farmers are facing severe financial pressures driving many from the land.
Apple grower Peter Darley, based in Orange in central western NSW, said the economic conditions for farmers in the region were “the worst he had ever seen”.
“In some cases farmers are getting as little as $1 to $1.50 per kilo (from wholesalers or supermarkets) and in supermarkets they are getting up to $7 per kilo,’’ he said.
“This is the worst return I’ve ever seen on food in my life and it’s a lot to do with ‘sticker-shock’.
“When consumers see the price that food is selling for they’ll only buy one or two apples whereas before they would buy a couple of kilos.”
Mr Darley said apple growers need to be paid about $2.50 per kilogram to cover the growing, harvesting, packing and freight costs and wages — and, if they are lucky, to make a modest profit.
South Australian onion grower Steve Rathjen, based in the Murraylands, said farmers had resorted to dumping good-quality onions.
“It should have never happened, there’s farmers that can’t move the volume and the supermarkets have a lot of suppliers and we haven’t got a big enough percentage of it at the moment,’’ he said.
“For a grower at the moment after packing we are getting about 30 cents per kilo and most of the supermarkets are selling onions around $2 per kilo.”
The Federal Government this month announced the new role of an agriculture commissioner within the Australian Competition and Consumer Commission to help curb anti-competitive activities in agricultural supply chains.
But, with no firm start date, it could be some time before farmers are given a reprieve.
When dairy industry deregulation was rolled out in July 2000 farmers received about 50 per cent of the retail price.
Now, according to Queensland’s Scenic Rim Robotic Dairy’s Greg Dennis, they get about 30 per cent and the consequences are dire.
“In the last four years in Queensland we have lost 30 per cent of our dairy farmers and of the surviving industry 70 per cent of them cannot pay their bills every month,’’ he said.
An industry in decline … dairy farmer Greg Dennis, the owner and operator of Robotic Dairy and Scenic Rim 4 Real milk at Tamrookum, near Beaudesert. Picture: Adam HeadSource:News Corp Australia
“The fallout from farmers in my part of the world isn’t actually slowing down, it’s speeding up.”
Fruit Growers Victoria Limited chairman Gary Godwill, 60, who produces peaches, pears and apples on his farm at Kialla East in the Murray Goulburn, said the concept of multi-generational farming was dying.
“When I look around the average age (of farmers) is about 60, where are the young blokes?” he said.
“They’re not coming on and that’s probably true of a lot of the agricultural industry.”
A Woolworths spokesman disputed the prices farmers said they were getting paid and said “on average across the season we pay our farmers considerably more than the numbers provided.”
A Coles spokesman said there are lots of different costs to consider in the journey from farm gate to supermarket shelf.
“Just some of the costs that need to be taken into account relate to transport, logistics, packaging, value adding, marketing, food safety, refrigeration, waste and labelling requirements, not to mention the large number of jobs that are created in the process of getting food from paddock to plate,’’ he said.
An ALDI spokesperson noted it was the first major supermarket chain to sign and implement the Food and Grocery Code on 15 June as a commitment to its supplier relationships.
“As a business, we do not support the introduction of pricing levels that are unsustainable in the long term and may put pressure on the supply chain,” she said.
Analysis from food consulting firm Fresh Agenda found over the past two years primary producers received anywhere between 40 per cent and 67 per cent of the selling price for fresh produce.
Aussie Farmers Direct, which delivers from the farm gate direct to customer’s doors, says the industry needs the public to ‘buy locally-produced products’.
“The big supermarkets are very good at what they do but the consequences of what they have been doing is the constant driving of efficiencies for lower prices and it does have an impact on the farmers,” spokesman Jim Cooper said.
“There’s been significant decline in family-owned farms in the last five years; smaller farms are disappearing and are being replaced by larger and larger farms.
He said supermarkets were in some states selling cherries, nectarines and peaches from the US and imported green asparagus from Peru.
“Imported food is … putting a lot of pressure on local Australian growers,’’ Mr Cooper said.
Woolworths maintains 96 per cent of the store’s fruit and vegetables sold are Australian grown.
In the past five years the US, New Zealand, China, Mexico, Peru, Turkey, Thailand, Italy, Spain and South Korea were the main countries Australia imported fresh fruits, vegetables and nuts from, totalling $1.8 billion. Nearly $500 million of imports entered the country in 2013-14 alone.
Since 2010, avocados from New Zealand have been our biggest food import, with $240 million worth of the fruit entering the country. This was followed closely by grapes from the US with $224m of the fruit sold in Australian supermarkets.
A spokesman for Agriculture Minister Barnaby Joyce said it was important to maintain fruit and vegetable imports to keep trade strong.
“Trade is a two-way street: effective trade means ensuring that we can safely import produce from the trading partners that buy our exports and we make sure we keep our production pest free to export to others,” the spokesman said.
AUSVEG Chief Executive Officer Richard Mulcahy said country of origin food labelling was also vitally important because shoppers could make informed decisions about whether or not to purchase imported food.
He said the ACCC also had an important role to play.
“AUSVEG would like the ACCC to continue to monitor retailer behaviour,” Mr Mulcahy said.
“Retailers have a lot of bargaining power as many growers depend on a single retailer for a substantial proportion of their sales.”