Most staple meats on Australian supermarket shelves have become more expensive over the last 20 years, but chicken prices have remained stubbornly low. While this might make chicken the popular protein choice among consumers, it's not all good news for poultry farmers. For farmers who have recently lost their supply contracts and been stranded with multi-million dollar assets, there is no good news.
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While an ACCC probe in the latter half of the year will look into whether there are competition flaws in the poultry supply chain, our farmers already know something is wrong. With just a handful of retailers in the Australian supermarket space, and practically no choice of processors available to contract to in NSW, poultry farmers are fighting an uphill battle. Their so-called competitive market is being dominated by only a few players - and farmers are not one of them.
Securing a kilogram of chicken for under five dollars might help the consumers' hip pocket, but, like we have learned from the dairy industry, we know that someone is losing out when fresh produce is cheap. Like in dairy, the movement of profits through the poultry supply chain is mysterious, and it's unclear who is reaping the benefits of chicken's popularity among consumers. Judging by the number of farmers exiting the poultry industry, it's not them.
It's not just farmers who are exiting the poultry industry. The number of chicken processing plants in NSW has shrunk drastically over the last 10 years. At the mercy of the retailers' dominance and their changeable pricing models, processors have suffered as well. But with basically no choice in who to contract to, farmers ultimately lose out.
An ACCC review is a positive step for poultry farmers but NSW Farmers is calling for a Treasury-instructed ACCC inquiry to ensure the ACCC has the capacity to fully investigate the industry.
- James Jackson - NSW Farmers President
