Pressure builds to halt retailers' extreme price power over farmers

He is also insisting on bigger penalties for those who do the wrong thing by suppliers and consumers.

With speculation brewing about Coles revamping its Down Down price cutting promotions and expecting suppliers to slash their own prices to pay for the contentious campaign, Mr Littleproud said Coles and Woolworths had "real form".

They blatantly used low supplier payments to fund their own marketing campaigns and profits.

"This is not just something recent," he said, noting how Monday's Four Corners report on retailer price gouging confirmed what The Nationals had long been warning.

Among those featured in the report was NSW fruit grower, Michael Cunial, who has spoken out about big retailer tactics, including his experience of having a $90,000 consignment of cherries graded and boxed for Coles, but downgraded when it reached Sydney so it fetched just $5800.

Mr Cunial, at Nashdale, near Orange, quit supplying the supermarket in 2022 after making a profit on just four of the 11 graded cherry consignments sent from his family's 80 hectare orchard that season.

"I'm in business, too. I accept everybody has a right to make money in business, but there have to be some standards," he said.

Mr Cunial has won applause from other producers for braving the spotlight and revealing the painful losses and lack of market transparency perishable crop producers often experienced.

"Ordinary people are being trodden down," he said.

"The big guys can double or quadruple the price they turn around and charge to customers, and we don't get that money."

NSW Farmers president, Xavier Martin, said Mr Cunial's experiences and other supplier claims of price gouging behaviour should be a wake-up call to fix Australia's unfair supermarket duopoly.

"Reports of suppliers having to pay retailers to get price increases on their own products are not isolated, nor are they the only examples of anti-competitive behaviour we see from these mega supermarket players," Mr Martin said.

Mr Littleproud said problems with "greedy supermarkets" were deep seated and the federal government should have acted earlier on specific issues it knew about as far back as 2022."

He said the Four Corners story pointed to farmers and families being ripped off at the checkout 18 months ago while Woolworths used economy-wide inflation as a cover to lift its own profit margins.

Mr Littleproud said the government could introduce big stick legislation with divestiture powers to break up the two retailers' 60 per cent stronghold on Australia's retail fresh food and grocery sector.

That potentially would mean forcing stores to be sold off to rival supermarket operators.

"We've been calling for divestiture powers and scaling up to bigger penalties for those who do the wrong thing by suppliers and consumers since 2022," he said.

At very least, he said the Australian Competition and Consumer Commission should have begun investigating clear evidence of meat and fresh produce price disparity between the farmgate and the checkout prices last year.

Coles' claim it had dropped some prices 20pc continued to be false, he said.

Meat prices had hardly changed since The Nationals identified in January that both supermarkets had not adjusted their meat shelf prices more than 8pc, despite an almost 70pc fall in livestock prices since June.

NSW Farmers' Mr Martin said total transformation of the nation's competition environment was necessary if fair food prices were ever to be achieved.

"For years we've had reports of farmers copping abuses of market power at the hands of the supermarkets, including retailers offering contracts on a 'take it or leave it' basis, or paying farmers prices well below their cost of production," he said.

"Giant middlemen are making super profits while farmers and families on either end of the supply chain struggle - we need meaningful competition reform to fix this obviously broken system."

At Orange, Mr Cunial said a long-awaited mandatory horticulture code of conduct could help make retailers take more responsibility for the actions, but he doubted any government would enforce action to divest Coles and Woolworths of their powerful respective 28pc and 37pc market shares.

"It's pretty extreme. You'd need to see a lot more social pressure and political will emerging to break up their market strength," he said.

"Governments are scared of these guys. They've got a lot of business sector influence, a lot of business interests and and a lot of very effective lobbyists.

"But at least we could do a much better job of policing them and making them accountable for their behaviour."

Despite the current level of community and political anger, he suspected "they'll probably only get a slap on the hand and be up to their same old tricks again within a year".