Tag Archives: Supermarket duopoly

advocate, Coffs Coast, Cost-price squeeze, Fruit growing, Small-scale farming

The decline of the big banana – Part 3

The story of Bill O’Donnell – Part 3

Nick Rose

This article first appeared in the Coffs Coast Advocate, 5.3.11

Bill O'Donnell's property today, near Bundagen, Coffs Coast, NSW
Bill O’Donnell’s property today, near Bundagen, Coffs Coast, NSW

In the last of a three-part interview, veteran Coffs Coast fruit grower Bill O’Donnell shares his reflections on the future of agriculture in the region

Bill has spent a lifetime growing fruit in the region – first bananas, then tropical peaches and nectarines – and he has seen the changes ringing over the last 50 years. Unfortunately, they’ve all tended to be in one direction, and it hasn’t been favourable to the growers of the Coffs Coast.

We’ve already talked about the deep crisis in the local banana industry. The massive Queensland industry and the uniformity in appearance demanded by the supermarkets quite simply means that – in current market conditions, cyclones aside – it’s uneconomic to grow bananas on a commercial basis in our region. The industry is literally in its death throes.

The relatively high cost of labour is a major impediment to viability. As Bill says, bananas are physical work in this region, where the plantations are on slopes, compared to the heavily mechanised Queensland industry.

“When I was involved”, he says, “we could afford to hire workers and pay ourselves a fair wage, because we were getting a decent price from the wholesalers. These days you just could not afford to do that, because the price hasn’t gone up while the costs have. I heard the other week that they were getting $8 a box. I can remember in the mid-1950s we were getting 8 pound a box – that’s $16, and the wages were 5 pound a week. You only needed one case of bananas a week to pay the wages. And in those days we might do 100 cases of bananas a week.”

How times have changed.

Cost-price squeezes also turned Bill away from the central markets with his tropical peaches and nectarines.

He believes that if they wanted, the supermarkets could set a minimum floor price at a level which would keep fruit growing viable. ‘But they won’t’, Bill says. ‘They’re chasing the farmers out of it. They really are.’

Another serious problem in Bill’s view is the death of publicly-funded experimental farms, which used to import and test the new varieties, and share the knowledge with the growers. Now it’s all privatized, says Bill, with the supermarkets buying up all the plant variety rights and licensing them to selected growers only.

‘It’s a nasty one, that’, says Bill, ‘I don’t care what anybody says. Those PVR rights, that’s where they squeeze the little bloke out, because you just cannot get the raw material. They will say, we don’t buy that variety.’

Increasing costs, low farm-gate prices, low bargaining power, lack of public investment – these are all serious challenges for agriculture in the region – and the country as a whole.

Blueberries are doing alright, says Bill, ‘for now’; but he puts at least some of that down to the cheap labour that a genuine family farm operation enables. ‘But you can see the writing on the wall with them’, he adds, because you can grow them from Atherton right down – so there’ll be an oversupply. They’re having prosperous days at present, but it’ll be like the bananas in ’59.’

The result is that agriculture is an aging industry, ‘and that’s a real problem for the country’, says Bill. The only real key to it I think is the local markets. You’ve got to be able to sell locally, because the grower has to be able to get a retail price…the killer for the retailer is the rent. In the old days, shopfront rents were next to nothing for greengrocers. ..Half the cost of fruit and vegetables I think is the rent that these people have got to pay. It’s just – well I think it’s criminal.’

Farmers themselves though can be their own worst enemies – in their refusal to cooperate with each other.

‘ I’ve seen them’, says Bill, ‘they had the banana growers’ federation for years – and that was one of the most successful co-ops that ever was. It was fantastic. But it took one bloke to ruin it… He worked out that he could make a dollar a case more if he took it to Adelaide – money was all it was. The answer to everything’s money, somewhere along the line. That’s how things can fall apart.’

If nothing changes, in Bill’s view, Australia will ultimately ‘depend on imported produce.’

advocate, Corporate control of food, Cost-price squeeze, Demographic crisis, Small-scale farming

The real costs of cheap food

Food Inc - lifting the lid on the industrialised food system
Food Inc – lifting the lid on the industrialised food system

The real costs of ‘cheap’ food

Nick Rose

This article first appeared in the Coffs Coast Advocate, 19.2.11

There’s been plenty of talk over the past month or so about the impact that the extreme weather events north of the border will have on food and grocery prices, vegetables and bananas especially.

There’s lots of things to say about this, beginning with the fact that if the mid-north coast still had a viable banana industry, and if production wasn’t so centralised and concentrated in cyclone-prone areas of north Queensland, then consumers might not be so vulnerable to the sorts of price spikes we’re likely to see in the coming months.

Be that as it may, there’s a bigger question at stake which is rarely addressed, and that’s whether the ‘normal’ price we pay for our groceries is sufficient to maintain a healthy, diverse and viable agricultural sector in this country over the medium and long-term, given the way that current market mechanisms operate.

It’s hardly any secret that many farmers are doing it tough, and have done so for a long time. So it should come as no surprise that Australia has lost around 50,000 farmers since the mid-1960s, and the exodus continues, with five farmers leaving the land every day.

Nor should it be any surprise that the average age of the Australian farmer is approaching 60. There simply aren’t the incentives for young people to want to embrace agriculture as a career and lifestyle choice. Which begs the question: who’s going to do the work of feeding us in 15 or 20 years’ time, when most farmers will be approaching 80, and there’ll be 35,000 fewer of them?

Does this sound like a crisis-in-the-making to you? It certainly does to me. In fact, it’s a crisis that’s been with us for many years now.

Which brings us back to the central issue: the proper cost of food. Through the centuries, farmers have always sought a fair price – a just price – for their produce. The trouble in recent decades is that they simply have not been getting it. At the heart of the global crisis in agriculture – Australia is but one of dozens of countries affected – is that farm-gate prices have failed to keep pace with the rising costs of inputs, freight and labour. In many cases farm-gate prices have barely risen at all.

Alongside this cost-price squeeze, we have seen an equally strong trend towards the concentration of ownership and control of most aspects of the food-value chain: from seed, to agro-chemicals, to grain trading and meat-packing, to food processing and manufacturing, and to retailing. We have witnessed the corporatisation and monopolisation of food and agriculture.

Many would say that the two trends  – the farm crisis, and the growth of agri-food monopolies – are closely linked. So closely, that the latter brings about the former.

There’s no simple answer to this, and I’m certainly not advocating a big price hike in groceries for consumers, least of all the many millions of middle and low-income Australians who are experiencing cost-of-living pressures already, with electricity and petrol price rises, not to mention the constantly rising cost of housing. But the question remains: how do we make farming viable – especially for smaller scale, bio-diverse farms – and yet keep food affordable?

We do need to move away from the culture of cheap food, where price is the sole criterion for making purchasing decisions. The logic of the food system as it stands points in one direction: the factory farm. And if you want to know why that’s a future we ought to say no to, come and watch Food Inc: see the interviews with factory farmers and workers in the United States; the conditions in which the animals are kept; the phenomenal waste that is generated, and the severe consequences for human and environmental health. The good news is that there are alternatives, and they’re being implemented all over the world, including on the Coffs Coast.