Australian banana growers are being forced to absorb an additional $1.5 million in freight costs every week, as skyrocketing fuel levies continue to bite across the supply chain.
Information collected by the Australian Banana Growers' Council (ABGC) shows transport levies have surged, rising from around 10-25 per cent to as high as 40-60 per cent. Around 500,000 cartons of bananas make their way across the country in any given week, and right now every single one of them is costing growers about $3 more than usual.
© Australian Banana Growers Council
The Federal Government's decision to halve the fuel excise and cut the heavy road user charge for three months is welcome. However, it's unclear how much impact these measures will have on growers.
"Fuel runs everything on the farm. Machinery, irrigation, fertiliser, packaging and transport," Far North Queensland grower Andrew Serra said.
"These costs don't just hit once – they stack up at every step of the supply chain."
Banana growers are essentially price takers, with little control over the returns they receive.
"If you're further along the supply chain, you've got the option to shift at least a little of the increase onto your customers and, in turn, they can do the same," Mr. Serra, who is also an ABGC director, said.
"We're at the end of that line. There's nowhere for us to pass costs onto and certainly no guarantee of a higher return to make up for it."
Mr. Serra said the situation was becoming increasingly difficult for growers to sustain.
"You can only absorb so much before it impacts the long-term viability of farm businesses," he said.
"We're committed to continuing to supply Australians with fresh, quality bananas, but the cost pressures right now are significant, and they're continuing to go up."
ABGC is calling for the Government to prioritise agriculture in any fuel discussions and to consider offering financial support to primary producers.
© Australian Banana Growers CouncilFor more information:
Amy Spear
Australian Banana Growers Council
Tel: +61 (0) 439 005 946
Email: [email protected]
www.abgc.org.au
