Row over supermarket produce prices heats up
Vegetable and fruit growers are backing a call for an investigation of supermarket prices, although the retail marketers deny they are ripping off consumers with huge mark-ups.
The Green Party wants an inquiry and says growers face ruin because two giant supermarket chains are using their powerful position to force them to sell vegetables and fruit for less than it costs to produce.
MP Sue Kedgley said yesterday a survey of 75 growers found supermarkets were marking up produce by up to 500 percent.
Food and Grocery Council chief executive Katherine Rich denied that today.
"I don't think supermarkets are ripping anybody off," she said.
"While supermarkets would love a mark-up of 500 percent, it just doesn't exist in reality."
Ms Rich said it wasn't fair to compare the prices growers received with supermarket prices.
"There are a lot of costs that are incurred throughout the supply chain," she said.
"A lot of goods get thrown away."
Horticulture New Zealand (HortNZ) said there should be an investigation.
"Growers are not getting paid any more for produce than they were five years ago," said chief executive Peter Silcock.
"As a general rule retail prices are between 100% and 200% higher than the wholesale price, but sometimes it can be much higher than that."
Mr Silcock said an investigation would explain where the costs were in the supply chain, and where the profits were going.
"The fact is, our growers are struggling to cope with a cost price squeeze that is reducing real turns," he said.
"New Zealand does not have an independent monitor of food pricing – in Britain a two-year investigation into supermarket pricing recommended the appointment of an ombudsman to act as a watchdog."
The Maori Party added its voice, saying the "shocking" mark-ups that had been revealed created another reason that GST should be removed from healthy food.
MP Rahui Katene is sponsoring a member's bill that would remove GST from fruit and vegetables, breads and cereals, milk and mild products, lean meat, poultry, seafood, eggs, nuts, seeds and legumes.
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Comments and questions3
You should all be buying your fruit and vege at the growers gate, fools if you don't, the freshness is unbelievable, sure the best goes to the markets, but there is nothing wrong with the gate products.
Same with meat, the MB specials lamb legs at 9.99kg and supermarkets at anything from 11.99kg to 13.99kg you do the sums, you find me a supermarket owner operator, who doesn't live in a mansion of a home, and drive an impressive vehicle, and travels the world on a regular basis, but pays his staff the very min wage, and that does not mention the main operator, who are creaming huge profits, and screw the very last drop out of every suplier.
It may be unrealistic for everyone to purchase at roadside gates, but its not unrealistic for the government to start regulating on price controls. Ask any other business what their gross margins are, & most will be under 50%!!!
Fresh Vegetables are the stuff everyone should be able to afford to eat. This has flow on health effects, & its time the government came to the party. Its been soft politics for too long.
Curb the health budget by regulating gross margins on fresh produce; and add phone & power charges to this while your there.
A large part of these businesses are overseas owned, & its time the government started to look after the people they represent; rather than the superprofits of the duopolies & cartels which currently exist.
Unions in some countries sets up co-operative supermarkets to bring down prices successfully. About time the unions in this country look at this, instead of channelling their members' money to the Labour party for election.