In recent inquiries, we've heard from fruit and veg growers about a lack of information and the challenges they face getting their products to market. This has included criticism of supermarkets.
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Woolworths' ability to serve customers depends on the health of the Australian fruit and vegetable industry. We work to build strong relationships with our suppliers, and that includes listening to industry groups that tell us that some growers are feeling real pressure.
On Monday, at the Queensland Inquiry hearing into supermarkets, I proposed a way forward to create a path for more fruit and vegetable price transparency. Let me tell you why.
Firstly, some facts: Woolworths buys 15-20 per cent of the fruit and vegetables grown in Australia.
We typically purchase them at 'wholesale' prices from growers (many of whom are aggregators also selling produce from other growers), or other wholesalers.
This wholesale price would naturally be higher than the farmgate price paid by our suppliers for the same produce - this is to cover their costs of packing (and in many instances sorting and grading) and transport. We have worked with some of these suppliers for decades.
The farmgate price of fruit and vegetables is determined by supply and demand in an open market. We know that when supply is reduced, prices rise (the price of lettuce post-2022 floods is a perfect example). And when supply is high, prices fall.
We understand that growers' cost bases have grown with inflation and the farmgate price driven by supply and demand doesn't always reflect that.
There have also been structural changes in the industry - 12 large businesses now provide around 50pc of all wholesale sales market wide.
While there is broad support for price transparency, there isn't consensus on how to deliver it.
Any proposal should include all players in the supply chain nationally so that growers have some visibility of the wholesale prices paid in different regions.
Hort Innovation is a grower-owned research and development body, appointed by the federal government.
Hort Innovation is best placed to conduct a study into what information would best assist on-farm decisions, and deliver an effective price transparency platform.
We would be willing to support Hort Innovation in this work, and commit to provide averaged historical data on the wholesale prices we have paid by commodity and region - and we call on other supermarkets, independent wholesalers and businesses who purchase fruit and vegetables to provide their data confidentially to Hort Innovation as well.
The challenges of the fruit and veg wholesale market require the wholesale support of all commercial fruit and veg buyers if we are to take the calls of the industry seriously.
- Paul Harker is the Woolworths chief commercial officer