The food processing manufacturing sub-sector is hurting badly from cheap imports, and some are warning that more needs to be done to stop it from disappearing.
The Weekly Times reports that the processing sector is “on the brink of collapse”, with the food and grocery industry in a deficit of $2.7 billion – compared to an excess of $4.5 billion in 2004-5 – according to KPMG research.
“We can't afford to see production and food processing disappear out of Australia because the high Aussie dollar is making imports so much cheaper,” Elders CEO Malcolm Jackman told the Times.
Jackman stressed that food country-of-origin labelling laws needed to be tightened and farming’s image needed to be improved.
Meanwhile, the CEO of SPC Ardmona, Terry Davis, has criticised the power of the supermarket duopoly of Coles and Woolworths, saying it was too powerful but this probably wasn’t too different from the situation in the United States or Europe.
Davis said that only one Australian tomato cannery survived, and processors were being punished by the high dollar and the purchasing practices of supermarkets.
The SPC CEO also spoke about the need for changes to taxation, in terms of state payroll taxes and federal taxation depreciation allowances.
“Tell me how a tax on employment fosters sustainability?” The Land reports him as saying.
“Government can balance our high labour cost environment by incentivising non-mining manufacturers with investment allowances as Kevin Rudd did in the global financial crisis.
“This would allow Australian companies to invest in best-in-class manufacturing capability and other productivity-enhancing technologies.”
669 food processing jobs have disappeared over the last two years.
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