Oversight of the country’s agriculture sector was considered ‘a new priority’ for the regulator
SYDNEY, Australia (Reuters) — Australia has appointed its first agricultural adviser to its competition regulator.
The country is seeking to protect farmers who have long complained that profits are squeezed by its dominant supermarkets and processors.
Supporting farmers is seen as critical to Australia’s goal of becoming the “delicatessen of Asia” by capitalizing on strong Asian de-mand for high-end produce, which saw the value of the country’s agricultural exports increase to $44 billion last year.
“The government is committed to fostering a vibrant and competitive agriculture industry to ensure that Australian agribusinesses are well placed to seize opportunities both at home and in emerging global markets,” said Australian treasurer Scott Morrison.
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Rod Sims, chair of the Australian Competition and Consumer Commission (ACCC), said oversight of the country’s agriculture sector was “a new priority” this year.
Mick Keogh, a cattle producer and former industry body executive, was appointed to a five-year term as an ACCC commissioner and will likely take on Australia’s sugar industry as an early priority. The industry is the world’s third largest raw sugar exporter.
Relations between growers and sugar millers have soured in recent months after several large producers announced plans to stop selling their sugar through an industry-owned marketing body, raising fears among farmers of lower prices.
Wilmar International Ltd., MSF Sugar, which is owned by Thai sugar giant Mitr Phol, and the Australian unit of Chinese agribusiness COFCO Corp. had planned to switch to in-house marketing arms next year.
Queensland passed a bill in December that will allow sugar farmers to choose who sells their produce, undermining the plans of the foreign millers. The three offshore processors have called on regulators to overturn the law.
Keogh will also be tasked with ensuring the country’s supermarkets do not abuse their power.
Coles, owned by Wesfarmers Ltd., Australia’s biggest retail group, was fined $10 million in 2014 after it was found to have used undue pressure to extract $16 million in rebate payments from 200 farmers in relation to apparent supply chain improvements.
“I’m hoping that … we show to the Australian people that we are doing everything in our power to open the markets, to turn around the prices, as well as to make sure that we get the research and development right,” said deputy prime minister Barnaby Joyce.
