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Farmers cry 'fowl' over free market moves
12 Dec 2003
New South Wales chicken growers are contracted to poultry processors to "grow out" chickens: the processor supplies the day-old chicks and feed, while the growers provide sheds, labour, electricity and gas for the few weeks it takes to get the birds to slaughter size. The growers say their role puts them in a weak position, so they support NSW legislation passed two years ago that maintains contract price regulation.
An industry committee sets base fees and approves contracts made by growers with processors. All growers are paid 49-55 cents a bird.
The NSW Farmers' Association's contract poultry group says allowing processors to negotiate freely with suppliers would be financially disastrous. But the National Competition Council has recommended that NSW be denied $12.86 million or 5 per cent of competition payments due this year, as it has failed to prove that chicken pricing regulation is in the public interest. The NSW Government has reluctantly agreed to free up the chicken-growing industry.
Cordina, a processor, said "we need growers, growers need us. We negotiate with 60 growers collectively; it's a fair process".
Australian Financial Review, 12/12/03.
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