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Aussie fruit shop boss exposes why prices are soaring at Coles and Woolworths

Australian farmers claim that families can save hundreds of dollars on fresh fruit and vegetables by buying them from major supermarkets.

As the cost of living continues in Australia, fresh food prices have come under the spotlight after rising above inflation.

The latest CPI figures show that the cost of fruit and vegetables increased by 6.7 percent in the March quarter compared to a year ago, with inflation at 5.1 percent.

Rising energy and fuel prices, the aftermath of the Covid pandemic, storms on the east coast and the war in Ukraine are all responsible for the rising cost of living.

However, the anger is shifting to Australian supermarkets which are still making billions in profits.

Farmer Guy Gaeta has proposed a boycott of major supermarkets because he says they rob consumers and farmers (From left in photo Guy Gaeta with wife Simonetta and son Michael)

Farmer Guy Gaeta has proposed a boycott of major supermarkets because he says they rob consumers and farmers (From left in photo Guy Gaeta with wife Simonetta and son Michael)

Independent grower Guy Gaeta (pictured with wife Simonetta) claims families can save '50 or 60 percent' on their fresh produce costs by shopping at Sydney Markets in Flemington instead of major supermarket chains

Independent grower Guy Gaeta (pictured with wife Simonetta) claims families can save ’50 or 60 percent’ on their fresh produce costs by shopping at Sydney Markets in Flemington instead of major supermarket chains

Prices are expected to rise further after the Lockyer Valley in southeastern Queensland, where many winter vegetables are grown, is flooded in May.

But Guy Gaeta, an apple and cherry grower from Orange, in New South Wales’ Central West, who sells in wholesale markets, told Daily Mail Australia that supermarket prices are much higher than they need to be.

Mr Gaeta urged consumers to boycott major supermarket chains, which dominate food sales in Australia more than in most countries.

“The only way you can teach Woolies a lesson is if you don’t buy your fresh fruit and vegetables there – go to the greengrocer or come to the Flemington markets.”

Mr Gaeta claimed that families could save ’50 or 60 per cent’ on their fruit and vegetable bills by shopping at the Sydney markets in Flemington.

Woolworths said it is 'always working to strike the right balance so that suppliers get a fair market price and our customers'

Woolworths said it is ‘always working to strike the right balance so that suppliers get a fair market price and our customers’

Coles told Daily Mail Australia that prices are driven by 'supply and demand' and that 'our team is working hard to bring prices down'

Coles told Daily Mail Australia that prices are driven by ‘supply and demand’ and that ‘our team is working hard to bring prices down’

“I just feel sorry for young families. I have grown children now, but I have grandchildren and that’s what worries me,” he said.

“They make vegetables for the same price or less than junk food and that’s a big health problem.”

He claimed that prices are often lower at wholesalers selling to the public, or at greengrocers, for blueberries, lemons, cherries, apples, cucumbers, peppers, ginger and lettuce.

“I don’t understand how supermarkets charge $1.50 for a lemon,” Mr. Gaeta said.

“Growers sell 20kg boxes for $20, and supermarkets make $150 boxes.”

A quick scan of online prices for Lebanese cucumbers on Thursday, June 23 showed that Woolworths sold them individually for $2.14, 30 percent more expensive than premium online fruit and vegetable supplier Fruitezy on the same day.

Mr Gaeta said what upsets farmers is the difference between what supermarkets pay them and the prices in the store.

‘People think that farmers are doing well. But farmers don’t see the prices that supermarkets charge,” he said.

“I understand we’re all trying to make money, but you don’t have to scam people.”

Another farmer, from North Queensland, who asked not to be named because he fears major supermarkets would stop buying his produce, estimated that supermarkets were charging ’30 percent’ more than they should.

‘I would say that consumers should look for value, I would say go to the independent greengrocer. If you’re looking for a better price, you’ll find it,” he told Daily Mail Australia.

‘The phenomenon of online shopping is really corrosive. People don’t check prices properly anymore, and supermarkets know it.

“They don’t look at value anymore and just go for convenience.”

He said it is time for supermarkets to show “transparency” about their profit margins.

The farmer, who grows mixed fresh produce, claimed that the difference between what producers and paid and what supermarkets sell the same items for is increasing at a rate that angers farmers.

“It’s all well and good to tell us prices are low in advertising, but if they think their processes are all above expectations, they should post on social media what the farmer paid so people can see for themselves” , he said.

“They need to show the public that they are essentially acting in their best interests and delivering value.”

He argued that supermarkets should not cite fuel costs as a reason for price hikes because farmers are disproportionately affected by rising gasoline costs.

Australian cherries are currently out of season, but growers say they get about $6 per kilo from supermarkets, who then sell them for up to $40 per kilo

Australian cherries are currently out of season, but growers say they get about $6 per kilo from supermarkets, who then sell them for up to $40 per kilo

‘A lot of people seem to think that supermarkets pay for all freight, no, they don’t. Getting produce from North Queensland to Brisbane or Sydney, for example, isn’t the price of the supermarket, it’s ours,’ he said.

“The farmer is the one with the most exposure to costs.”

He said producers are angry that major supermarkets are making billions of dollars in after-tax profits, while most farmers are “either breaking even or losing money.”

“Most farmers will break even or lose money because of input costs – fuel, wages, chemicals, etc. Most costs are as high as 30 to 60 percent.

‘If farmers are under pressure, don’t only honest retailers share that? I haven’t heard supermarkets complain that they are having trouble making ends meet.’

“The ACCC seems rather toothless to us. Where are their investigations into price transparency between what a grower gets and what is paid in the store?’

“This country has a failed competition policy. The heat really needs to be increased at supermarkets.’

Mr Gaetta claimed senior government officials had told him that price gouging is not illegal in Australia.”

“It may not be illegal, but it’s immoral.”

Major supermarket chains contacted by Daily Mail Australia defended their pricing on the basis of a ‘complex array of factors’.

Both Woolies and Coles are considered signatories to an agreement guaranteeing fair treatment for producers.

“We operate in a highly competitive market and we are always trying to strike the right balance so that suppliers get a fair market price and our customers have access to affordable fresh produce,” Woolworths said in a statement to the Daily Mail Australia.

Woolworths claimed that prices had risen “in some varieties” due to reduced supply “following the east coast floods and continued bad weather in key growing regions”.

It said other fresh produce, ‘such as apples, pears, citrus and avocados’ [are] in good stock’ and are ‘great value’.

Coles claimed ‘growers want to work with it’ because of [our] commitment to ‘strong, multigenerational … partnerships’ with producers, including long-term contracts’.

It said prices are determined by “supply and demand” and that “our team is working hard to get prices down.”

“Our customers can expect an improved volume from many fresh produce lines in the coming weeks thanks to the extraordinary efforts of our growers.”

In fiscal 2021, Woolworths’ after-tax profit was $1.97 billion, while Coles’ profit was over $1 billion.

“Think of their free fruit trick for kids. Producers struggle to make ends meet, but they can afford to give things away for free and still make huge profits,” the farmer told the Daily Mail Australia.

The four major supermarket chains control 80 percent of the market in Australia, which critics say is stifling real price competition.

Woollies has 37 percent of the market, Coles with 28 percent, while Aldi is third with 10.5 percent. IGA (Metcash) is fourth with 7 percent.

Aldi controls about 10 percent of the market and steadily increases its sales to more than $10 billion a year.

Australian consumers spent $125 billion in supermarkets last year.

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