300 percent markup on fruit and vegetables

Nugget · Jun 11, 2011

http://www.couriermail.com.au/news/...es-off-the-table/story-e6frep2f-1226073565941

Rising prices keep fruit and vegetables off the table amid claims of 300 percent markups

QUEENSLANDERS are being told to make do with tinned fruit and vegies as soaring prices push fresh produce out of reach.

The number of people who say they have been forced to skip fresh fruit and vegetables because of skyrocketing prices has jumped from 6 to 30 per cent in six years.

And retailers have been accused of profiteering from this year's flood and cyclone disasters, hitting shoppers with 300 per cent mark-ups.

In one case, a farmer found pineapples being sold at a small fruit shop for 14 times the price paid to growers for the same produce.

A Sunday Mail investigation has revealed shocking price hikes by retailers are forcing up grocery bills, leaving families struggling to buy fresh food.

The mark-ups have infuriated growers, who say they are bearing all the risk, but being paid a fraction of the price eventually charged.

Major retailers are receiving most of the blame, but farmers have also blown the whistle on smaller fruit shops.

One farmer found pineapples at a small Brisbane fruit shop on sale for 14 times the price paid to farmers for the same pineapples.

Queensland pineapple farmers say the average mark-up by major retailers was about 300 per cent the price paid to the farmer.

After factoring in costs, including packaging and transport, the increase by retailers was about double the total cost of production.

Pineapples were being sold for an average $3.99 each. The farmer receives about $1. Marketing and transport costs account for another $1. But farmers sometimes receive as little as 50c a pineapple.

Gino Marcon, a vegetable farmer at Coonarr, east of Bundaberg, said the war between Coles and Woolworths had driven prices down at the farm gate. "It is causing us grave concerns for our future," he said.

North Queensland Senator Bob Katter has received constant complaints from farmers and consumers.

He said he was contacted by a pumpkin farmer supplying to a major supermarket for 33c/kg, with his pumpkins then sold to shoppers for $3.80/kg. With no packaging to justify the increase, he said consumers should be "spitting rage".

Federal Independent Nick Xenophon said the retail giants had too much power, meaning they could drive down prices paid to farmers.

Coles spokesman Jim Cooper denied charging the mark-ups claimed, saying it ran on a profit margin across the board of 4 per cent. He said Coles dealt directly with farmers, with growers paid fair value for their produce.

Brisbane mother Belinda Hill looks for cheaper produce at farmers' markets.

"From a cost point of view, it's better value for money than buying from supermarkets," she said. "For what you're paying you get much nicer fruit and vegetables."

The number of Queenslanders who say they can't afford fruit and vegetables has soared as rising prices make fresh produce a luxury for struggling households.

About 30 per cent of people told a Queensland Health survey that high prices prevented them from eating more fruit and veg last year, compared with 6 per cent in 2005.

Chief health officer Jeannette Young advised people wrestling with food bills to pick seasonal produce and consider frozen vegetables.

"There are always cheaper alternatives that are also healthy choices," she said.

Queensland Health has collected a healthy food basket since 2000, during which costs of produce have risen 61 per cent. The increase outstripped the national Consumer Price Index rise of 40 per cent in the 10 years to March 2010.

Australian Bureau of Statistics figures show fruit and vegetable prices spiked in the three months to March and Queenslanders were bearing the brunt. Oranges, tomatoes and onions were more expensive in Brisbane than in Sydney and Melbourne in the period, but retailers including Woolworths said prices shifted throughout the seasons due to varying growing regions.

Natural disasters, such as Cyclone Yasi and the floods, have been blamed for the high cost of some items, including bananas which are selling for about $13/kg.

Wholesaler Peter Kedwell from Pershouse Produce said consumers expected to get their fruit and veg too cheaply.

"They don't value what goes into creating it for them," he said and warned there would be increasing imports because buyers were primarily price-motivated and Australian farmers had higher production costs than overseas.

"Pound for pound there's nothing cheaper than fruit and vegetables," he said.

"There's a perception by the Australian consumer that if anything goes over $3/kg or $4/kg it's expensive and it certainly is not."

AUSVEG, a peak body for 9000 vegetable growers, said buyers saw high prices on some items like bananas and assumed all costs were up.

"Prices are fairly consistent. They are fluctuating a dollar either side of what is considered normal," spokesman William Churchill said.

Queensland Council of Social Service President Karyn Walsh said there was little money left for healthy food after price rises for electricity, water, rent and transport.

"Our recently released Cost of Living report showed that in the past five years electricity, gas and water have gone up 63 per cent, public transport 48 per cent, and rent 35 per cent compared to CPI increases of 19 per cent," she said.

"It is inevitable people will turn to cheap, filling food which in many cases is not the most nutritious option."

An independent review of concessions for low-income families was needed, she said.
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Shaddam IV · Jun 11, 2011

I regard it as a sign of government corruption that the Grocery Duopoly in Australia has not been reigned in. Someone is getting paid off. The position that the big two grocery chains hold in this country show clearly that some in the government put the welfare of themselves before the welfare of the citizens of Australia. I wonder who is taking the kickbacks, and I wonder how many pollies are looking forward to a board position with these companies when they leave politics?

I wonder what spot price is on pineapples?

Blockhead · Jun 12, 2011

Qld Health is one of the most staggeringly incompetent government departments out there so i take anything they say with a grain of salt. Having said that, Bananas were $14/kg at Woolies last time i looked. I never eat them anyway.

Clawhammer · Jun 12, 2011

Buy at farmer's markets where you can folks ... the money goes straight into their hands and those guys are doing it tougher than most.

boyd_05 · Jun 12, 2011

Clawhammer said:

Buy at farmer's markets where you can folks ... the money goes straight into their hands and those guys are doing it tougher than most.
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+1 Was just there yesterday, i feel much better handing my $$$ over to them

errol43 · Jun 12, 2011

Oh to live in Bundy... Pineapples(small but sweet) 59cents... custard apples 2kg for $3.97...tomatoes $2.34kg....avocados 59cents each even bananas $6.99. Not at supermarkets(prices same as Brisbane)

Opps! Now you know how I save money to buy silver.

Regards Errol43

Tacrezod · Jun 12, 2011

I really don't understand how the supermarkets dictate the price at which they buy produce. If I'm a grower, then it's MY bloody pineapples/tomatoes/milk or whatever and surely I can charge what I want for it?

Fair enough, Woolies may flex their muscles and refuse to buy for a few days, but in the end they'll have to pay the price.

Am I missing something , or just being naive?

Neddy · Jun 12, 2011

We moved to Townsville 6 months ago (just in time for Cyclone Yasi etc). Unfortunately there is only the duopoly here - no Aldi. Prices are ridiculous - don't know how some people can afford them.

What staggers me most is the cost of beef. Given that we have so many cattle producers up this way, I would have thought that meat would have been cheaper than down south. But it's not.

It will be interesting to see what happens to the retail price of beef given the current crisis with overseas exports. Surely that means a lot more supply for local markets, thus the prices should go down?

But I'm probably ony dreaming and hoping .............

pmfiend · Jun 13, 2011

You can grow pineapples in pots. When you buy a pineapple just cut the spikey top of them off & plant it. A baby pineapple will sprout out the top of that. Rinse & repeat when you harvest that one, and you'll end up with plenty of pineapples.

Cherry tomatos grow like weeds, and are great in salads. Acid free varieties are even tastier.

Clawhammer · Jun 13, 2011

Neddy said:

We moved to Townsville 6 months ago
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You're in for a treat after winter Neddy. Far north to be in the stinking hot tropics, but not far north enough to get the cooling monsoon or rainforest and then the heat makes the local populace go troppo!... and wait till you see what they do when they get behind the wheel

As for fruit, veg and meat, all the best stuff goes to the capital cities and the rest is left behind (just like the apples in Tasweigia). I couldn't beleive when I moved to Brisvegas, not only were the roads fantastic, the fruit and veg is cheaper and better quality than what's on offer where it was grown!

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