Relief for chicken farmers as the country’s biggest processors agree to fix unfair contracts

The Australian Competition and Consumer Commission (ACCC) has made concessions to the country’s largest chicken processors to make some of their contracts with farmers fairer.

The $3 billion industry is dominated by two large companies, with Ingham’s and Baiada Poultry supplying about 70 percent of Australia’s chicken meat.

The ACCC said the companies had too much power and the contracts could cause “significant financial damage to growers”.

The agency was asked in 2020 to investigate imbalances in bargaining power in supply chains for perishable agricultural products in Australia, and released its report later that year.

The processors have now agreed to make changes to contracts to clarify the circumstances under which they can require growers to upgrade their farm facilities, and when processors can make changes to their grower manuals.

Some chicken producers supply processors without a contract.Supplied: Australian Chicken Meat Federation

Sudden changes to grower manuals can include things like changing the density requirements for birds in a barn, which can lead to high costs for growers.

The processors have also agreed to clarify the circumstances in which processors can impose additional costs on growers and to balance notice periods for cancellation clauses.

Chicken farmers’ problems don’t stop there

But Peter Wojcicki, chairman of the NSW Farmers Poultry Committee, said there were other issues growers had with the current situation.

One of the big ones is the variability in the growing fee between states and even between processors.

He said farmers would like to see some consistency in pay for the same work.

Mr Wojcicki said contract terms also varied.

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