McCain Foods Australia and South East Potato growers settle contract

Another price cut in a contract settled yesterday between South East potato growers and major potato-processing company McCain Foods Australia has threatened to wipe-out the industry if the downturn continues, according to potato producers in the region.

The price of $26.50/tonne was a settlement made between growers contracted to McCain out of necessity, Mingbool potato farmer Terry Buckley, said.

“The price set is not sustainable?—?but we have signed in an endeavour to maintain the amount of tonnage as we have previously been growing and selling,” he said.

“It is a very disturbing price?—?if it continues at this level for more than one year we may not have a potato industry anymore for there will be no point in it.”

South East growers produce around 100,000 tonnes of potatoes annually for McCain Foods?—?which operates processing factories at Penola and Ballarat.

A McCain Foods spokesperson told The Border Watch the settlement reached with South Australian potato growers for the 2011 crop was fair.

“The final price negotiated was fair and competitive, and we look forward to working with our growers for the next season and beyond,” he said.

Mr Buckley said McCain had explained to farmers the further price cuts were a consequence of the high Australian dollar and an increasingly competitive market.

“There is a lot of pressure coming from the US and Europe as they have yielded good crops and are cheaper because of the dollar?—?as a result, all home brand spuds found in the supermarkets have come from overseas,” he said.

“New Zealand also gives us a hard time as their spuds are often imported up north?—?they have such good yields and because it is cheaper for the processors to have a ship come into Brisbane than to pay for the road freight costs to have them come from down here.”