Price Determination in the Australian Food Industry A Report

Retail prices
• The average retail value of the total grocery retail market in the last three years has increased
from $1.56/kg to $1.76/kg.
• This reflects a mix of factors including a higher share of the market being taken by specialty
product, offset by a greater volume of private label.
• In the past four years, competitive policies of the major retail chains have restricted the
increases in retail prices of private label rice products.
• The chart below shows average national retail prices for 1kg white long grain product between
branded and private label product.
Figure 109. Retail prices for rice, white long grain, 1kg, cents/kg
cents
250
200
150
100
Aust brand
private label
50
0
1999 av May 2002 May 2003
Source: Industry sources
Retail prices over time
Figure 110. Retail prices for rice packs, long grain, 1kg, cents/kg, quarterly 1994–2003
cents
250
Sydney retail
Price Determination in the Australian Food Industry A Report
200
150
100
50
0
Source: ABS
1994 2003
Melbourne retail
Brisbane retail
• It is not meaningful to provide a time series comparison of retail prices and farmgate returns in
a single chart.
• The farmgate returns to rice growers are based on the derived farmgate return from a
combination of markets serviced by the industry. Rice growers are paid a weighted average
return per variety, based on the average returns from export and domestic markets in each
season. This bears no relationship to the level of the retail sales dollar on a long grain product
alone.
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