Royal Commission needed into supermarket pricing.

Last week, Wide Bay MP Llew O’Brien called for a Royal Commission into the predatory pricing practices of the supermarkets.

As one example of their unconscionable behaviour, O’Brien called out the recent way that Coles and Woolworths have handled QDO’s efforts to have a 10 cent/litre Drought Levy imposed on all milk.

O’Brien was quoted as saying that “Coles and Woolworths have completely bastardised” the proposal. His call was backed several other politicians, who have called the Drought Levy PR stunts pulled by Coles and Woolworths among other things a “farce”.

Currently, Coles has put the levy only on their 3L private label which has simply led shoppers to by a 1L and 2L to save them the 30 cents; that way Coles can say that consumers do not want to support the levy since sales won’t reflect this.

We can’t help but question why it took less than 72 hours for Coles and Woolworths to back down on the plastic bag ban and yet the campaign for a Drought Levy across all brands that was started seven weeks ago by QDO is still not producing a fair outcome for farmers. Customer outrage towards the duopoly’s grab for profit in the bag saga seems to outweigh any interest in developing sustainable relationships with its suppliers and their primary producers.

The major dairy processors have said they want to support our farmers with a price increase and are open to audit, but they are hamstrung in a poor game of piggy-in-the-middle. Lion Dairy and Drink has announced a 6 cents/litre increase and Norco a 5 cents/litre increase to help assist with Drought. It’s good news but even they admit that it can only be temporary unless the retail price is increased permanently to meet rising production costs.

And still there is the unanswered as to why Coles insists on paying the levy through an application process rather than distributing back through Norco who supply their private label milk.

QDO is certainly delighted that O’Brien, Littleproud and others are looking at ways to deliver practical outcomes. We need them to continue to hound the supermarkets, to vote through a Royal Commission so that it can expose the supermarkets' predatory practices towards its suppliers.

Queensland Dairyfarmers' Organisation
QDO Vice President Matthew Trace