The high price of fresh fruit and vegetables won’t come down anytime soon according to fresh food suppliers.
Speaking at a food security inquiry Claire McClelland from the Australian Fresh Produce Alliance said continuing high inputs for producers is keeping prices high.
“Once a price is up it very rarely goes back down … once the price of fuel, or packaging or energy is up we very rarely can reduce that cost,” she told the inquiry.
She said ongoing labour shortages and supply chain challenges were also keeping the price of produce high.
“The cost of our inputs is directly related to the price of food,” Ms McClelland told AAP.
“As we see those prices rise it has a direct relationship to our production costs.”
The industry has called on the government to invest in a steady and reliable supply chain because of the “far-reaching effects” disruptions can have.
“In the last 24 months we’ve seen how precarious horticulture supply chain is, how events abroad or locally like the flooding … can lead to price shocks and reduce yields” Ms McClelland told the inquiry.
“Impacting not only farmers, but also the availability and affordability of fresh produce in Australia.”
And she warned that Australian supermarket shelves could empty out again if further disruptions to the supply chain are experienced, and harvest jobs cannot be filled.
“If there’s no one to harvest the food there’s simply no food,” she said on Friday.
Earlier the inquiry was told retailers had also experienced significant input hikes with power price increases up by 25 per cent in some areas.
Jason Robertson from the Australian Retailers Association said his members largely tried to avoid passing on higher costs for labour, rent, supply chain and energy to consumers.
He said a recent survey of association members which include retailers and online shops found two thirds had not passed those costs on.
“Our members tell us that they’ve done their best to absorb those cost increases and some have eaten into margin in order to try and prevent those higher costs result in higher prices,” he told the inquiry.
“It’s very hard to absorb all of those cost pressures that are coming through the business.”
And he said the retail sector was encouraged by forecasts from the Reserve Bank that inflation will continue to decline over the next 18 months.
– AAP
