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Farmers react to price war

Mick Sims, of Kookaburra Farms, doesn’t expect his profits to be affected by the supermarket price war.
Mick Sims, of Kookaburra Farms, doesn’t expect his profits to be affected by the supermarket price war. Renee Pilcher

GYMPIE fruit and vegetable growers had a mixed reaction yesterday to Coles' offensive to wrest the "fresh food" crown from rival Woolworths in the fruit and vegetable price war.

Coles slashed the shelf price of some of its fruit and vegetables by half this week, claiming it would help farmers shift excess stock.

The move has incensed unions, farming groups and independent politicians, who want it referred to the competition watchdog.

So desperate was the situation from one Gympie grower's perspective that he suggested it was time for farmers to blockade the market and force the country's leaders to protect producers.

Alex Livingston, chief executive of peak farming body Growcom, warned that while the lower prices were good for consumers in the short term, they could spell the end of Australian farmers in the long term.

He called on Coles to prove its price cuts would not impact on farm gate prices.

Mr Livingston's sentiments were echoed by Mooloo bean grower Len Carlson, who has sold his produce through the open market for the past 55 years and said bodies like Growcom were "as weak as water" for not doing more to protect primary producers.

Mr Carlson said this latest move by Coles would not end happily for farmers, whether they sold through the open market or direct supply.

"It is time we stand up for ourselves," he urged.

Long Flat farmers Mick and Ross Sims have been growing and supplying vegetables directly to Coles, and to a lesser degree Woolworths, for the past 16 years and said they were happy with their contractual arrangements, which had helped them weather the storms of farming more comfortably than many growers at the mercy of the open market.

They had to meet strict quality criteria and accreditation to maintain their contracts, but it was well worth it, they said.

The Sims, who own Kookaburra Farms, said they didn't expect the prices for their hydroponic lebanese cucumbers and gold button squash to be affected by the price war.

"You will find most 'supply' growers won't be affected," Mick said.

He said oversupply in the central market system was what was causing the price reduction.

Mary Valley Orchards' Heinz Gugger sells persimmons and nectarines on the open market, including to Woolworths and Coles.

He yesterday described the predicament for farmers as "almost winless" and said things would get worse before they got better.

He said pushing more farmers out of the industry would significantly impact the economies of regions like Gympie, where the flow-on effect could be devastating.

"We employ 40 people in our high season," he said.

Perhaps it was time to blockade markets and force the government to pay attention, Mr Gugger said.

The Construction, Forestry, Mining and Energy Union joined the chorus of outrage yesterday, and called on the Australia Competition and Consumer Commission inquiry into the duopoly to "watch closely".

`"Woolworths announced a net profit of $2.12 billion last financial year and Coles' profit was $1.6 billion," CFMEU national secretary Michael O'Connor said.

"It's time these companies exercised more social responsibility for Australian jobs and families."

Independent senator Nick Xenophon and MP Bob Katter both joined the debate, warning that Australia wouldn't be able to feed itself within four years and would be a net importer of food.

Topics:  coles farmers fresh produce price war woolworths

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