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Home » Business » Coles & Woolworths, a long way from being ‘people’s supermarkets’

Coles & Woolworths, a long way from being ‘people’s supermarkets’

Posted by: Lara Ihnatowicz    Tags:  Coles, food waste, price wars, supermarkets, sustainable farming, Woolworths    Posted date:  February 6, 2012  |  No comment



FRUIT and vegetables will become the new battleground of the supermarket price war after Coles announced it will reduce the cost of selected products by up to 50 per cent from today. If Woolworths follows suit, fresh produce will become the latest product to be heavily discounted by the supermarket giants, following price cuts to mikl, bread, toilet paper and washing powder by both companies in the past year. (Sydney Morning Herald)

And again, it looks like farmers will be in the middle of the supermarket price war between Coles and Woolworths. Earlier this week Coles continued its down down spiral of prices, while still failing to recognise the broader negative impacts of their short sighted pricing campaigns and produce requirements – and clearly similar things will now happen in Woolworths.

Excessive ‘quality assurance’ requirements, along with potential price drops means that while consumers are seeing themselves as the winners, farmers are increasingly finding it difficult to make a living. With more price drops, farmers will potentially get even less dollar earnings per tonne for their produce.

While I’m not suggesting an EU type situation where massive subsidies have lead to the whole ‘rivers of milk and mountains of cheese’ situation, I feel there needs to be some recognition of the role of local farmers if we’re going to create more equitable  and sustainable food system.

If the cornerstones of eating sustainably are consuming locally grown produce and eating seasonally, shouldn’t there be greater support for many Australian farmers who are trying to run farms in financially viable and sustainable ways? Subsidising farmers that grow crops in geographically harsh and extreme areas of our country is by no means a solution. Support should be focused on those who are planning and strategising around the best and most efficient ways to grow produce.

The ins and outs of what this sort of support network would look like is most likely something far beyond most people’s expertise, but you would hope there would be support from the government and other strong external bodies to help farmers negotiate with the big two supermarkets. Many of them simply don’t have the power, nor the freedom to bargain for fair prices on their produce. The situation has been the same, if not worse in the UK where small producers exist in a culture of fear – too scared to speak out about a situation where the risk of ‘reprisals’ is impoverishing them.

Even with price drops at the supermarket check out, markups on wholesale prices that Woolies and Colies pay to farmers are still huge. More worrying than prices is the impact of excessive food wastage before produce even leaves the farm, a situation not driven by farmers, but caused by the rejection of produce by supermarkets.

A recent McKinsey report suggests that between 20 and 30 percent of food waste actually occurs before food even reaches the consumer. This is a statistic that is exacerbated by stringent look and feel requirements of the big two supermarkets in Australia – mangoes must be a certain size, and bananas of a certain bend. As the produce specifications from Woolworths for Cavendish bananas state: ….the banana must be ‘slightly arched, with blunted butt end and intact, undamaged necks. Nil with double pulps or ‘sausage shapes’’. That is, no banana that is a little skewif, a little special.

The above might not sound excessive, but there have been regular references and allusions to the seemingly obscure perfection driven specifications that the big two are asking for. No longer are vegetables and fruit something natural that come from the earth, they are something that must fit man made requirements which ignore their origins.

Having recently watched a documentary about The People’s Supermarket in London – I was mortified to learn that entire fields of broccoli(as one example of many) were being tilled back into the soil, essentially destroyed. Why? They were not seen to fit within size requirements for supply to one of the large British supermarket chains. They supermarket had held off ordering stock until quite late in the season for broccoli, meaning once they decided they were ordering, the broccoli was bigger than the pretty little broccoli heads that the supermarket deemed  to be visually acceptable for their customers. At this point, the cost for the farmer to actually harvest the broccoli outweighs any earnings they may see selling the produce elsewhere – so the next best option is to simply work edible vegetables, which vast amounts of resources have gone into, back into the earth.

The People’s Supermarket (now in two locations in London) works as an alternative to the large supermarket chains, and is run by the people for the people. Amongst their many initiatives and ways of operating, they have taken advantage of the aforementioned un-wanted crops, and have either been able to purchase beautiful edible – but strangely unwanted produce – from farmers unable to sell to the supermarkets. And they’ve done so through cheaper prices, and at times even for free.

While the majority of Australians will not question price drops in any serious way – if it’s positive for the hip pocket, consumers will generally be satisfied – it’s essential that more attention gets paid to the wastage, losses and even economic turmoil that is caused by extreme competition between the governing forces of the food retail market; Woolworths and Coles. If consumers are voting with their hip pockets and letting their feet do the talking by choosing the cheaper options, their not also be an alternative – such as the People’s Supermarket – which supplies reasonably priced, health conscious fresh produce options which also meet consumer and industry quality standards. If the mainstream options are simply the big two, sadly, the majority of Australians are barely given the opportunity to make an alternative choice. Making a better alternative mainstream may shift the balance of power from the current duopoly, to something fairer, with fairer choices and options.

 


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Lara Ihnatowicz



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