Competition watchdog finds retailers distorting prices of fresh produce, not pricing transparently

There could be good news coming for consumers following the release of the Competition Commission's provisional report on its Fresh Produce Market Inquiry (FPMI).

The inquiry focused on five fruits - apples, citrus, bananas, pears and table grapes, and six vegetables - potatoes, onions, carrots, cabbage,tomatoes and spinach.

It found that some major players in retail are responsible for price distortions, cartel behaviour and setting up anti-competitive barriers to new entrants.

"The inquiry found that the state of the national fresh produce market’s infrastructure is in a concerning state."

Hardin Ratshisusu, Deputy Commissioner - Competition Commission

John Maytham gets comment from consumer journalist Wendy Knowler, who also followed up with the 'Big Five' retailers.

Knowler was particularly pleased about the recommendation that packed fresh produce should display not just the selling price, but the price per kg/g.

"Because we have shrinkflation and we have competing products making items slightly smaller which you can't really see, they should put the unit price which is the per kilogram or per 100 gram price on the label as well.

"It's not a legal requirement, but it makes effective and true price comparisons a lot easier - some retailers do follow this."

"The sense I got was that they felt there was too much maths required for effective price comparison for consumers, and I felt that was a really wonderful recommendation."

Wendy Knowler, Consumer Journalist

Ratshisusu told the press conference that the feedback they'd received from retailers was that this would be expensive to implement.

"The comment was 'we're not convinced by that argument', and nor am I, entirely."

Wendy Knowler, Consumer Journalist

Knowler also highlights the inquiry's finding that markups on fresh produce are still too high in some cases.

"Effectively, the case is that there were still some barriers to entry for smaller suppliers that the market was still very much in the hands of the big players."

"If the inquiry would lead to smaller markups, that would certainly be a huge win for consumers."

Wendy Knowler, Consumer Journalist

Following up with the five major retailers, Knowler was told they are 'still studying the report.'

They have a 16 July deadline to respond to the recommendations.