Chicken growers in the spotlight
NSW Farmers is urging Australia’s new Labor government to act on power imbalances in poultry meat supply chains, after an investigation by the consumer watchdog unearthed the use of potential unfair contract terms by processors.
The Australian Competition and Consumer Commission (ACCC) has identified potential unfair contract terms (UCTs) in chicken growing contracts, including terms that allowed processors to vary growers’ supply arrangements or impose additional costs on growers.
NSW Farmers President James Jackson said the Australian Government must act now to make UCTs unlawful.
“Labor has committed to outlawing UCTs for businesses employing fewer than 100 people and with a turnover of less than $10 million a year,” he said.
“We hope to see this new government take action in the competition space to make fresh food supply chains more sustainable, and Labor’s commitment to outlawing UCTs is an important build on the work of the former government in this space.
“The ACCC probe has prompted some chicken meat processors to change terms in their current contracts, but we really need hard and fast rules that restrict UCTs.”
NSW Farmers had long been pushing for competition reform in the poultry meat industry, and a 2020 inquiry into bargaining power in fresh food supply chains was a breakthrough moment, Mr Jackson said.
“Competition in the poultry meat industry has been hollowed out by the consolidation of processors and the few major retailers that dominate the supermarket sector,” he said.
“Most poultry meat farmers in NSW have no choice in which processors to contract to, leaving them in a vulnerable position where they have no alternative but to accept contracts containing UCTs.
“The latest ACCC probe has focused on the chicken meat industry, but banning UCTs will benefit all farmers and small businesses,” Mr Jackson concluded.