What's Happening?
The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) has conducted a review of the relationship between broiler growers and integrated producers in Australia. The review aimed to identify market failures and potential regulatory or non-regulatory actions to address these issues. Concerns raised by broiler growers include unfair contract terms, capital upgrade requirements without long-term contract certainty, and non-compete clauses. The review follows previous inquiries and reports, including the National Farmers Federation's recommendation for a mandatory code of conduct and the Australian Competition & Consumer Commission's Perishable Agricultural Goods Inquiry. ABARES has completed its evidence gathering and is preparing a draft report for stakeholder review, which will be submitted to the Commonwealth Minister of Agriculture, Fisheries and Forestry.
Why It's Important?
The review's findings could lead to significant changes in the Australian poultry industry, impacting both growers and integrated producers. If market failures are confirmed, regulatory changes could improve contract fairness and market efficiency, benefiting growers who have faced challenges with current commercial arrangements. The potential introduction of a mandatory code of conduct could provide more stability and transparency in the industry. These changes may also influence international trade and competitiveness, as Australia is a major player in the global poultry market. The outcome of the review could set a precedent for other agricultural sectors facing similar issues.
What's Next?
Once the draft report is reviewed by stakeholders, it will be submitted to the Commonwealth Minister of Agriculture, Fisheries and Forestry. The government will then decide on the appropriate regulatory or non-regulatory actions based on the report's findings. Industry stakeholders, including growers and integrated producers, are likely to respond to the proposed changes, potentially leading to negotiations or adjustments in commercial practices. The review's recommendations could also prompt further inquiries or studies into other agricultural sectors facing similar challenges.
