Amrit Singh, who grows bananas on the Coffs Coast, sold his crop to Coles indirectly through a wholesaler, an agreement he said was worth hundreds of thousands of dollars a year. In August, Coles confirmed it would stop selling Coffs Coast bananas, pumpkins and cucumbers, citing an effort to simplify its supply chain. The produce is now expected to come from north Queensland.
"Freight costs [involved in] getting access to those [new] markets are going to be extremely high," Mr Singh said. He described Coles' decision as "anti-competitive" and said farmers who do not sell directly to supermarkets have "no power" to negotiate trade agreements, forcing them to reduce prices to support promotions. "That doesn't come out of [Coles'] pocket, that comes out of returns, so we actually [foot] the bill for those specials," he said.
Industry experts have claimed major Australian supermarkets were centralising supply chains to cut costs, warning some producers could now be at greater risk of having their products removed from shelves. Woolworths said its supply chain network had expanded. Coles rejected the experts' claims.
An inquiry by the Australian Competition and Consumer Commission (ACCC) last year found Coles and Woolworths had overwhelming power in their trade relationships with suppliers. Mr Singh said small-scale growers are "price takers", not price makers.