This week, the ACCC's Supermarkets Inquiry Interim Report was released by the Australian Government.

The ACCC is investigating all aspects of Australia's leading supermarket businesses, including concentration and competition in the sector, rising prices and shrinkflation, supermarket buying power and other consumer and producer concerns.

During its initial work, the ACCC received over 80 public submissions and spoke to more than 21,000 customers across Australia between February and April 2024 – the largest number of responses it has ever received for a consumer survey.

It also held seven roundtable discussions across the nation for farmers and produce wholesalers to discuss their experiences with supermarket supply chains.

The Interim Report makes no specific findings or recommendations, which are set to be in a Final Report that is handed to the Government in early 2025, but the ACCC’s work is exceptionally detailed. 

Cost of Living is the number one concern for Australians as the Reserve Bank tries to get inflation between the 2-3% range after a peak of 7.8% in Q4 2022. Groceries prices is a key component in determining the cost of living, as it is an essential item.

This follows the ACCC announcing legal action against Coles and Woolworths for misleading consumers through discount pricing claims on hundreds of common supermarket products.

A new mandatory Food and Grocery Code, currently open for consultation, will ensure Aldi, Coles, Woolworths and Metcash are subject to multi-million-dollar penalties for serious breaches of the Code. 

Yesterday, CHOICE released its second government-funded price monitoring report, giving Australians accurate data on where to get the cheapest groceries.

To compile the Report, CHOICE visited 104 stores across Australia including Aldi, Coles, Woolworths and IGA.

The report found that Aldi once again had the cheapest basket of goods, with the price of CHOICE’s basket falling from the previous quarter.

Report Findings - The Cost of an Average Basket of Groceries Nation Wide: 

• Aldi: $50.79 (with and without specials)
• Woolworths: $68.70 (without specials), $68.37 (with specials)
• Coles: $69.91 (without specials), $66.22 (with specials)
• IGA: $78.95 (with specials)

The next phase of the Supermarkets Inquiry will see the ACCC conduct hearings with the supermarket sector throughout October and November 2024.

The ACCC has invited further feedback on the key issues raised in the Interim Report by 18 October 2024.

Prime Minister Anthony Albanese said, “I directed the ACCC to commence an inquiry into supermarkets in January and today they deliver their Interim Report.

“This is an important piece of work and we will study it closely.

“My Government is taking a range of actions to make sure Australians are paying a fair price at the checkout and Australian suppliers are getting a fair price for their goods.

“Customers don’t deserve to be treated as fools by the supermarkets. They deserve better than that.”

Assistant Minister for Competition, Charities and Treasury, Andrew Leigh added, “The Albanese Government’s ACCC Supermarket Inquiry is the biggest, most thorough look at supermarket competition in over 15 years.

“Businesses need to do the right thing by Australians - and the Albanese Government is committed to improving the food and grocery sector so it works for families and farmers.

“Greater competition is critical for lifting dynamism, productivity and wages growth, putting downward pressure on prices and delivering more choice for Australians dealing with cost-of-living pressures.”

NSW Farmers Principal Economist Samuel Miller said the findings had come as no surprise, with farmers and families having long suffered at the hands of the nation’s supermarket duopoly.

“Prices are rock bottom at the farm gate, and sky-high at the checkout – it’s clear these supermarket superpowers are pushing up profits and leaving farmers and families to foot the bill,” Mr Miller said. 

“For years, farmers and families have suffered as our supermarket profits have soared, and there has been a total lack of accountability or penalties for any unconscionable behaviour impacting the supply chain to date.

“Farmers have been unable to speak out for fear of retribution, and families have been left with no choice but to hand over their hard-earned money to this monopoly – and that must stop.”

Mr Miller said farmers had a short window to get perishable agricultural goods – such as fruits and vegetables – to consumers, and supermarkets had often used this fact to pressure farmers into either taking lower prices or leaving food to rot.

As the ACCC continued its investigations, and with legal action underway on a ‘fake discount’ scandal, Mr Miller said tough penalties and expanded powers for the competition watchdog were vital to bring Australia’s grocery giants to account. 

“A mandatory, enforceable Food and Grocery Code is a positive step, and will go some of the way to address this culture of unconscionable behaviour we’re seeing within Australian supermarkets, but it’s not the end of the road for competition reform,” Mr Miller said.

“These superpowers are not only reaping huge profits, but they are doing so at farmers and families’ expense. 

“We need solutions to increase price transparency, an economy-wide prohibition on unfair trading practices and new divestiture powers to bust apart duopolies in cases of extreme bad behaviour, if we want to sort these superpowers for once and for all.

“We know exactly how our supermarkets have been treating us, and we can’t let them keep pushing us up against the wall – or else more and more Aussie families simply won’t be able to afford to put fresh food on the table every day.”