Australian Farm Institute (2013), Will supermarket save or enslave agriculture?, Farm Policy Journal, Vol. 10, No. 1 - Autumn 2013, Surry Hills, Australia
ISSN 1449–2210 (Print)
ISSN 1449–8812 (Web)
Cook R (2013), Fundamental forces affecting fresh produce growers and marketers in the United States , Farm Policy Journal, Vol. 10, No. 1, pp. 01-11, Autumn, Surry Hills, Australia.
The United States (US) fresh fruit and vegetable – produce – industry is very diverse, including over 300 products, each with its own structure at the production and first-handler marketing levels. Despite this diversity, virtually all fresh produce shares two fundamental attributes: perishability and seasonality. The high level of risk observed in the fresh produce sector arises from the combination of product perishability and weather variability. Weather factors can always undo the best-laid plans by unexpectedly shifting short-run supply or demand. Perishability limits storability and the ability of firms to adjust to short-run disequilibria in supply and demand, other than through price, making markets volatile. This article analyses the US fresh produce industry based on Michael Porter’s Five Forces model plus two additional forces, as described in Choices by Olson and Boehlje (2010). It is one of a series of articles – published by various authors in Choices in 2010 and 2011 – which utilise this expanded forces model to frame the discussion of forces for change in various commodity sectors and industries. The forces include: (1) rivalry among existing competitors, (2) threat of new entrants, (3) bargaining power of suppliers, (4) bargaining power of buyers, and (5) the threat of substitute products (Porter 2008). The two additional forces affecting competition are: (6) technology and (7) other drivers of change. Please see Olson and Boehlje (2010) for an explanation of the combined methodology.
Spencer S (2013), Dairy's challenging horizon, Farm Policy Journal, Vol. 10, No. 1, pp. 13-29, Autumn, Surry Hills, Australia.
The Australian dairy industry sits at crossroads. It hasn’t grown, as an industry, over the past decade and has a diminished global standing and reputation. In the Australian domestic market, the dairy news has been dominated by stories of the demise of fresh milk regions due to the ‘deep discounting’ of private label milk products. As analysed in this article, that situation’s influences are more complex. This paper intends to provide elements to understand the factors behind the current challenges and proposes priorities for its future – if it is to get its act together.
Boyer P, Blanchot (2013), The French food sector price and margin surveillance program: economic studies and interprofessional dialogue in French food chains, Farm Policy Journal, Vol. 10, No. 1, pp. 25-31, Autumn, Surry Hills, Australia.
The French Food Sector Price and Margin Surveillance Program, also called the observatory, was created at the end of 2010 in the following context: • increasing price volatility • suspicions expressed by producers and consumers about retail margins • political commitment in favour of enhanced consumer purchasing power, of a more market-oriented economy, and raising farmers’ concerns. The observatory’s mission is to provide analysis of the values collected at various stages of the food chain. After describing the context of the observatory’s creation, this paper outlines its organisation and margin calculation methodologies, illustrating them through the use of case studies. The paper also focuses on analysing supermarket food sections’ accounts, which traditionally raises suspicions from both producers and consumers. As a supplement to its sectoral analysis, the observatory recently developed a macroeconomic decomposition of food demand into added values, imports and taxes.
Schaper M (2013), The Australian farm sector and the competition and consumer Act, Farm Policy Journal, Vol. 10, No. 1, pp. 33-45, Autumn, Surry Hills, Australia.
For almost 40 years Australia has had a national competition law designed to ensure that markets operate effectively and fairly. First known as the Trade Practices Act 1974, and more recently renamed the Competition and Consumer Act 2010, this body of law has had a major impact on farming enterprises and commercial practices. This paper provides an overview of the major elements of the Act, and the role and responsibilities of the Australian Competition and Consumer Commission, the national agency responsible for enforcement of the Act. It discusses recent competition developments in a number of areas of direct relevance to the Australian agricultural sector, including the use of collective bargaining, the operation of the Horticulture Code of Conduct, country of origin and food labelling, reforms to the wheat export regime, and allegations of misuse of market power and unconscionable conduct in relation to supermarkets and their dealings with suppliers.
Hadler R (2013), Supermarkets- Helping Australia grow, Farm Policy Journal, Vol. 10, No. 1, pp. 41-47, Autumn, Surry Hills, Australia.
The two major supermarkets are often attacked by farmers and food manufacturers for forcing down prices and abusing market power. However, the popular debate glosses over the complexities of the food and grocery supply chain and the positive contribution of the major supermarkets to the Australian economy. One popular myth is that supermarkets rip farmers off by paying them a slim proportion of what they charge consumers at the checkout. New research confirms that farmers actually get a fair share of the retail price in many fresh produce and manufactured commodities, including milk. Another popular myth is that the major supermarkets import all their private label products. In fact, the opposite is the case. Over 96% of all fresh produce is Australian grown. We do this because our customers want Australian made products and we want to help Australian farmers and small businesses. The reality is that many of supermarket customers, suppliers and team members live in rural and regional Australia. This level of engagement drives a deep interest in the fortunes of rural and regional Australia and reinforces our commitment to growing our businesses in a sustainable way for rural and regional communities.
McKinna D (2013), Living with supermarket power, Farm Policy Journal, Vol. 10, No. 1, pp. 49-57, Autumn, Surry Hills, Australia.
The level of concentrated market power in the Australian grocery retail industry is unprecedented: Coles and Woolworths now collectively control 74% of market share. This shift in market power is neither temporary nor cyclical, but has in fact created a fundamental structural change that is expected to remain for years to come. Whilst consumers do have the power to respond by boycotting the big two, the value for money on offer is difficult to refuse. It is therefore up to the agrifood producer to alter their business model in order to survive in today’s retail environment. Given that supermarket power is a reality agrifood businesses must adapt their business models to remain profitable. Attaining economies of scale, adopting new technologies and improving management can lead to reduced production costs. Channel diversification can be used as a risk management tool as well as better suiting the individual needs, capabilities and circumstances of each business. By adopting ‘new age’ cooperative marketing models, market power can be generated. Creating closed-loop supply chains through strategic alliances or vertical integration are also methods that can be used to attain market power. Finally, by increasing the returns on production through premium pricing based on product differentiation, the viability of a business can be improved. Implementing the appropriate strategy allows the individual agrifood producer to utilise the present market power imbalance to their advantage
Adams J (2013), Farmers' markets: the fresh new link in the food chain, Farm Policy Journal, Vol. 10, No. 1, pp. 59-61, Autumn, Surry Hills, Australia.
Jane Adams is the principal of Jane Adams Communications a Sydney-based marketing consultancy specialising in food, wine, and regional and urban community development projects. Since 1998 Jane has pursued a vital personal interest in farmers’ markets, a significant driver of economic development and food marketing in regional Australia. She is the recipient of the Geoffrey Roberts Award (1997), an international fellowship that facilitated her research of American farmers’ markets. A catalyst of the growth of farmers’ markets across Australia and New Zealand, Jane has worked with community groups from Albany to Auckland to establish farmers’ markets in regional and urban centres. She currently chairs the Australian Farmers’ Markets Association.