ACCC to probe pricing practices of supermarkets

The Federal Government has today vowed to investigate claims of supermarket price gouging, with the announcement of another inquiry into the supermarket industry.

In an address to the National Press Club in Canberra, Prime Minister Anthony Albanese said Treasurer Jim Chalmers would direct the Australian Competition and Consumer Commission (ACCC) to conduct a 12-month price inquiry into the supermarket industry.

“(It will) look at how things like online shopping, loyalty programs and changes in technology are impacting competition in the industry and to examine the difference between the price paid at the farm gate – and the prices people pay at the check-out,” Mr Albanese said.

“For me, it’s this simple. When farmers are selling their product for less, supermarkets should charge Australians less.”

The ACCC said the inquiry would cover the pricing practices of the supermarkets and the relationship between wholesale — including farmgate — and retail prices, including how the sector had changed since the ACCC’s last inquiry in 2008.

“When it comes to fresh produce, we understand that many farmers are concerned about weak correlation between the price they receive for their produce and the price consumers pay at the checkout,” ACCC Chair Gina Cass-Gottlieb said.

“We will use our full range of legal powers to conduct a detailed examination of the supermarket sector, and where we identify problems or opportunities for improvement, we will carefully consider what recommendations we can make to Government.”  

The ACCC expects to publish an issues paper in February seeking views on the key issues it will consider in this inquiry. An interim report will be provided to the Australian Government later this year, and the final report is due to be provided early next year.  

Farmers demand action

National Farmers Federation President, David Jochinke, welcomed the announcement of the ACCC probe into supermarkets, but insisted the inquiry must lead to action.

“We’ve seen past reports collect dust on shelves in Canberra. Reports and recommendations don’t make our food system fairer. We need sustained political leadership and action,” he said.

“While we await the ACCC’s findings, we call on the Government to maintain its momentum on broader competition reforms which will create a fairer policy environment for farmers.”

Shadow Minister for Agriculture and Leader of The Nationals David Littleproud also welcomed the announcement of the inquiry, but claimed the Labor Government had to be shamed into calling it.

Mr Littleproud has been calling for the ACCC to be directed to investigate what he says is clear evidence of meat and fresh produce price disparity between the farmgate and the checkout prices since November 2023.

“The review could have been done and dusted, with decisions already implemented, to help farmers and families and try to stop them from being ripped off over Christmas last year,” he said.

“Labor must now get cracking and give farmers and families the answers they need and deserve.”

Supermarkets under the microscope

The ACCC’s inquiry into the supermarket sector is separate to the Government’s recently announced review of the Food and Grocery Code of Conduct, which relates to the conduct of retailers and wholesalers towards suppliers.

The Queensland State Government last week also launched an enquiry into grocery price gouging.