Sarah FalsonFood prices have risen “dramatically” in the past few years compared with prices in other developed countries, according to a grocery report from the Australian Competition and Consumer Commission (ACCC), which doesn’t bode well for electrical retailers who are trying to get the get the best they can from consumers who are constantly weighed down with rising mortage rates, petrol prices and housing costs.
The ACCC said the new ‘review’ will investigate all aspects of the industry from the grocery checkout to the farmgate trail, in a bid to identify why prices have risen so dramatically.
The inquiry follows a request from the Rudd government to identify “highly concentrated” food industry was large enough to sustain a third supermarket chain of a similar size to Coles and Woolworths, according to a report from the Australian Financial Review (AFR).
“Central to the inquiry is whether the two major supermarket chains are able, by virtue of their dominance, to keep their payments to suppliers low while increasing the price for consumers and shutting out smaller competitors,” said the AFR.
The inquiry will look at the structure of the industry, and the difference in buying power of smaller and larger retailers.
According to the ACCC, food prices have jumped nearly 12 per cent between September 2005 and last year, which is double the consumer price index rise of 5.9 per cent during that period.