Price Determination in the Australian Food Industry A Report
Price Determination in the Australian Food Industry A Report
Price Determination in the Australian Food Industry A Report
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MAJOR ADJUSTMENT – WHAT’S HAPPENING<br />
The<br />
sector<br />
The<br />
adjustments<br />
How <strong>the</strong>se have had<br />
impact<br />
<strong>Industry</strong><br />
response<br />
Fresh fruit<br />
and<br />
vegetables<br />
Shift to greater retail direct<br />
buy<strong>in</strong>g. Rationalisation of<br />
suppliers to fewer larger<br />
suppliers.<br />
Lower volumes flow<strong>in</strong>g <strong>in</strong>to<br />
wholesale markets. Greater<br />
focus on wholesale sector<br />
susta<strong>in</strong><strong>in</strong>g bus<strong>in</strong>ess <strong>in</strong>comes.<br />
Limited response at <strong>in</strong>dustry<br />
level on a commodity-bycommodity<br />
basis. Fresh food<br />
<strong>in</strong>dustries are seek<strong>in</strong>g an<br />
extension of <strong>the</strong> role of <strong>the</strong><br />
Retail Grocery <strong>Industry</strong><br />
Ombudsman and greater<br />
mean<strong>in</strong>g for codes of<br />
conduct.<br />
Individual l<strong>in</strong>es fac<strong>in</strong>g<br />
decl<strong>in</strong><strong>in</strong>g consumer support.<br />
Lower demand. Lower<br />
produce prices at wholesale.<br />
Push<strong>in</strong>g more fruit to coproduct<br />
streams.<br />
Improved <strong>in</strong>vestment <strong>in</strong><br />
varieties and po<strong>in</strong>ts of<br />
difference. Enhanc<strong>in</strong>g<br />
category management <strong>in</strong><br />
conjunction with retailer.<br />
Eggs<br />
Increased use of private label<br />
by <strong>the</strong> retail sector at a<br />
significant price reduction<br />
from proprietary brands.<br />
Requirement for egg<br />
producers to meet welfare<br />
standards <strong>in</strong> cage design by<br />
2008 will require major<br />
capital overhauls.<br />
Consolidation of egg<br />
production, pack<strong>in</strong>g, and<br />
market<strong>in</strong>g has been go<strong>in</strong>g on<br />
for several years postderegulation<br />
of egg<br />
production and market<strong>in</strong>g<br />
arrangements on <strong>the</strong> east<br />
coast.<br />
Investment <strong>in</strong> egg production<br />
facilities.<br />
<strong>Industry</strong> marketers sought<br />
and ga<strong>in</strong>ed retail price<br />
<strong>in</strong>creases due to higher<br />
costs.<br />
Sugar<br />
Significant susta<strong>in</strong>ed falls <strong>in</strong><br />
<strong>in</strong>ternational sugar prices<br />
due to chang<strong>in</strong>g world<br />
market dynamics coupled<br />
with poor seasonal<br />
conditions.<br />
Investment <strong>in</strong> greater<br />
automation of egg handl<strong>in</strong>g<br />
through to pack<strong>in</strong>g to offset<br />
higher fixed costs.<br />
Strong seasonal price<br />
competition rema<strong>in</strong>s at retail<br />
and wholesale as nonaligned<br />
marketers seek to<br />
take advantage of lower<br />
production costs.<br />
Lower farm <strong>in</strong>comes.<br />
No loss of certa<strong>in</strong>ty of supply<br />
of sugar to domestic markets<br />
due to <strong>the</strong> abundance of<br />
sugar volumes.<br />
<strong>Industry</strong> has sought<br />
adjustment assistance<br />
through state and federal<br />
governments.<br />
There is no scope for relief<br />
through <strong>the</strong> domestic<br />
products market due to its<br />
small scale, <strong>the</strong> decl<strong>in</strong>e <strong>in</strong><br />
sugar consumption and <strong>the</strong><br />
cost-competitiveness of o<strong>the</strong>r<br />
sweeteners <strong>in</strong> <strong>in</strong>dustrial uses.<br />
<strong>Price</strong> <strong>Determ<strong>in</strong>ation</strong> <strong>in</strong> <strong>the</strong> <strong>Australian</strong> <strong>Food</strong> <strong>Industry</strong> A <strong>Report</strong><br />
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