Horticulture can't pass on costs

by OnFood

Peak horticulture body for Queensland, Growcom, says that the PM does not understand the nature of the horticulture industry if she thinks that farmers will be able to just pass increased costs from the carbon tax on to consumers.

Growcom CEO, Alex Livingstone, said that while some sectors of agriculture may be in that position, fruit and vegetable growers have little to no ability to pass increased costs down the supply chain.

“Horticulture is a price-taking industry, based on supply and demand. Growers have received minimal increases in the prices they receive for produce in recent years, while at the same time government red tape and compliance costs have seen their costs increase significantly,” said Livingstone.

“The Prime Minister may be correct when it comes to some agricultural commodities, but not in horticulture. These comments reflect a lack of understanding of the supply and demand nature of the horticulture industry.

Horticulture is the industry and science of plant cultivation including the process of preparing soil for the planting of seeds, tubers, or cuttings. Many of that research and production feeds in to the agricultural industry, such as for crop production.

Livingstone said that horticulture was being overlooked in terms of financial compensation and help for the carbon tax as compared to other sectors of agriculture.

“Growcom recognises that the effects of climate change on our own industry will be very serious if projections are correct. However, the Federal Government’s current policy provides no effective compensation for horticulture.

"Carbon sequestration as an income stream is not an option for our growers, who often have quite small farms, and the unavoidable use of electricity in packing sheds, refrigeration and irrigation will see a considerable increase of costs.

Keywords: carbon tax , growers, horticulture, queensland

Comments:

Wednesday, July 20, 2011 by

Perhaps the PM needs to tackle the supermarket duopoly before imposing a carbon tax?

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