Food and Grocery Code the start of the journey

NSW Farmers has called the introduction of the Food and Grocery Code for the supermarket sector as a welcome start towards a fairer system for farmers.

However it cautioned that more work is required to ensure agricultural markets work competitively to distribute value back to the farm gate.

NSW Farmers’ spokesperson and dairy producer Rob McIntosh welcomed the key role the Australian Competition and Consumer Commission (ACCC) will have in enforcing the code on supermarkets and wholesalers.

“But our ongoing concerns mean that we still believe a mandatory code should be adopted in Australia.

“Important protections include limits on participating supermarkets’ ability to change contracts with suppliers and a duty to act in good faith which should help balance disparity in market power.

“Better transparency will reduce the risk of a reoccurrence of schemes that force rebates like those seen in the recent prosecution of Coles by the ACCC.”

NSW Farmers is disappointed that modern compliance tools were not incorporated within the code but it looks forward to the three year review required by the code.

Mr McIntosh said it was imperative the distortions created in agricultural markets was managed to ensure the market operated for the benefit of the Australian economy.

“The new code needs our attention particularly the proportion of the sector that subjects itself to the code, the impact of the duties and the ability of the ACCC to monitor and enforce compliance.”

NSW Farmers encourages the government to adopt other broader reforms to Australia’s competition policy crucial to Australia’s international competitiveness.

“The ACCC needs a specialist agricultural advisory unit to ensure it understands the complexities of agricultural markets. In the long term, we encourage the Competition Policy Review Panel, led by Professor Ian Harper, and the Federal Government to adopt important reforms to competition policy proposed by National Farmers’ Federation,” Mr McIntosh concluded.

3 March 2015

Contact: Veneta Chapple

Phone: 0429 990 218

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