The NFF Horticulture Council has reaffirmed its call for tighter government controls on supermarket trading practices as annual profits are reported by the major listed companies.
Council chair, Jolyon Burnett said the results would speak for themselves, and that not even a cost-of-living crisis had dampened the supermarket drive for profits above all else.
"When pitching their annual results to investors, supermarkets will make a show of their year-on-year growth and expanding profits, but will at the same time tell suppliers they can't afford to pay them any more," said Mr Burnett. "In some instances, we have growers telling us they've not had an increase in the price they're paid for as long as a decade. It amounts to corporate gaslighting at a grand scale and shows total disrespect to longstanding and long-suffering suppliers, who are not getting a fair share of the supermarket success."
The Council says it has written to the Federal Treasurer specifically on tightening controls on how supermarkets trade fresh produce, including how they negotiate on price and the way supermarkets calculate and communicate with suppliers about volumes they expect to order.
"Government needs to grapple with the fact supermarkets will continue to walk all over customers and suppliers to deliver ever-increasing profits for shareholders," Ms Burnett said. "There is absolutely public benefit from having both affordable food and a sustainable farming sector, which the market is now most obviously failing to deliver. The case for greater government intervention has never been as clear."
The issue has already become a political battle, with the Greens party saying that Coles making $1.1 billion in profits during the 'crisis' shows the corporate supermarket duopoly needs to be broken up and price gouging needs to be made illegal.
"Coles is cashing in on a crisis, showing complete contempt for the people who are struggling the most," Greens Economic Justice Spokesperson Senator Nick McKim said. "This is corporate greed at its ugliest, and it's happening because Labor refuses to rein in these corporate giants. Coles' $1.1 billion profit is a sick joke for the millions of Australians struggling to afford food and groceries."
She added that they are 'price gouging' as food prices continue to drive Australia's high inflation numbers.
"It's time to break up the supermarket duopoly and make price gouging illegal," Mr McKim said.
Charity group Oxfam Australia is also calling for urgent action to address the growing inequality in Australia by better taxing the excessive profits of big corporations. Chief Executive Officer Lyn Morgain highlighted the injustice of the supermarket duopoly's profits.
Woolworths and Coles dominate the supermarket sector in Australia, holding a combined market share of 65.5%. The Allan Fels inquiry into price gouging revealed that market power and a lack of competition are driving up prices for consumers.
"It's unacceptable that while everyday Australians are struggling to put food on the table, Woolworths and Coles continue to report staggering profits," Ms Morgain said. "It's clear the Australian people are fed up with it. We need the government to step in and directly address the failures in the system that allow this toxic situation to continue. While this year Coles and Woolworths did not generate the crisis profits spikes we saw in 2021 and 2022, they still raked in huge profits that many in the community are deeply concerned by with food prices so high.According to Oxfam analysis of profits made in 2021 and 2022, Woolworths alone raked in $5.6 billion in crisis profits, at the same time as inflation soared and the COVID19 pandemic and Ukraine war was at its peak. This high profit situation has moderated slightly, but not fundamentally changed, which is unacceptable."
Oxfam Australia is calling on the government to introduce a 'crisis profits tax'.
"A tax on the excessive profits of big supermarkets like Woolworths and Coles would not only discourage price gouging, but also help boost the budget during tough times and provide much-needed funds to address inequality and ease cost-of-living pressures," said Ms Morgain. "We welcome the Greens contribution to the debate on tax reform, particularly with respect to closing the tax loopholes for the mining industry and an excess profits tax in big corporations. We need bold proposals to make our tax system fairer, ensure we have more funding for public services and reduce the inequality created by unbridled and excessive corporate profits."