While Coles’ announcement that it intends cutting the price of some lines by as much as 50 per cent is good news for the consumer, making a profit is getting tougher and tougher for primary producers.

Jeff McSpedden from The Lagoon grows hundreds of acres of corn each year but is moving away from growing vegetables and turning to fat lambs and cropping as a viable alternative.

The chairman of the research and development committee for Horticulture Australia, Mr McSpedden said yesterday the writing was on the wall for many people in the industry.

“Coles and Woolies are the dominant players. They have a duopoly on the market,” he said. “Supply and demand sets the prices, so at present we’re in peak season and the conditions are good, resulting in an oversupply of fruit and veg.

“But how long can it last? It’s just not sustainable. If the type of prices they’re talking about continues on the longer term then a lot of farmers will exit the industry.”

Mr McSpedden said if the Australian Competition and Consumer Commission believes Coles and Woolies aren’t gouging the market, it is wrong.

“If they can cut prices by 50 per cent and still make a profit then questions have to be asked,” he said. “In effect, the latest price war is just spin by Coles trying to get people in the door.

“The only redeeming factor is there is an oversupply of vegies at the moment and this will help reduce that.”

But, he said, there’s a good chance the duopoly could start looking at more imports.

Federal Member for Calare and Opposition agriculture spokesman John Cobb said the announcement by Coles to cut fruit and vegetable prices is just a marketing ploy to get consumers into their supermarkets.

“It is normal for fruit and vegetable prices to fluctuate throughout the year. In fact, very few foodstuffs vary as much in price throughout the year as fruit and vegetables,” he said.

“I expect that Coles is just trying to take credit for the normal reduction in price at the height of the season. The Coalition will be monitoring the price cuts to make sure they are not trying to drive down farm gate prices.”