Media Release

Independent Federal Member for Kennedy Bob Katter questions whether the national competition watchdog has rolled over to have its belly rubbed by the supermarket giants while dairy farmers loom as early casualties of a price war that began on Australia Day.

Mr Katter said the Australian Competition and Consumer Commission’s refusal at a Senate inquiry this week to elaborate on its discussions with supermarket giants, about slashing their home‐brand milk price by one‐third, might be construed as protectionism for the supermarket oligopoly.

He said the ACCC’s prevarication at the Senate inquiry was in line with a history by government – firstly of ‘action’ to deliver free‐fire zones for the big supermarket chains; and then, in sharp contrast, a continuing refusal to take any action to restrain unconscionable oligopolistic power.

“Eighty‐five per cent of the food market in Australia is held by just two supermarket chains, who can pay us anything they like and no‐one can lay a glove on them, not the least being the government,” said Mr Katter.

“Dairy farmers and milk processors have both given evidence that slashing milk to the $1/L prices of 20 years ago is unsustainable, so the ACCC should be using its powers under the Trade Practices Act to ensure supermarkets aren't engaging in predatory pricing quite literally over the dead bodies of our farmers.”

The ACCC’s apparent inability or unwillingness to intervene also showed the urgent need for legislative reform on competition policy, given a concentration of market share unseen anywhere else in the world, said Mr Katter.

“There were more than 200 dairy farms in North Qld before dairy deregulation on 1 July 2000, when dairy farmers in North Qld (along with almost all in Qld and NSW) had prices reduced from 58.9c/L to 41.5c/L. Yet within two years of deregulation, the price to consumers had gone up 41c/L. This was $1130 million extra profit each and every year to the supermarkets and others in the marketing chain. Now we have left only 60 dairy farms.

“For the ACCC to ignore the historical and current situation, it can only be regarded as a despicable derogation of duty.”