Farmers, meat processors and small logistics companies are likely to welcome today’s announcement by the ACCC of the launch of a market study into the cattle and beef industry.
Last year the Australian Senate launched an inquiry into the effects of market consolidation on the red meat processing sector. The inquiry identified a need for further investigation into competition within the industry.
As such, the Australian Competition and Consumer Commission (ACCC) has been allocated an additional $11.4 million in funding over four years to thoroughly investigate issues in regional and rural areas through the establishment of an Agriculture Enforcement and Engagement Unit.
“Competition and consumer issues in the agriculture sector are a priority for the ACCC,” said ACCC chairman Rod Sims.
“The cattle and beef market study is the first of several agricultural market studies that the ACCC will conduct over the coming years. A number of ACCC Commissioners and I will be closely involved in the market study, including at the public forums.”
The scope of the ACCC’s investigation includes a number of key areas, including competition between cattle buyers and processed meat suppliers, efficiency obstructions, differences in bargaining power, transparency and barriers to entry and expansion.
A consultation process will be carried out as part of the investigation, including public forums and receipt of oral and written submissions. Submissions can also be made confidentially.
“We understand that some market participants may fear retribution from commercial partners for speaking to the ACCC. Equally, firms may be reluctant to provide the data we need to understand the complete picture,” ACCC Commissioner Mick Keogh said.
“Therefore, we have established a strong confidentiality regime to assure interested parties that we will treat any confidential information sensitively. We will also accept information from anonymous sources.”
A draft report is expected to be released around September this year, with the final report likely to be published in late November.