INTERNATIONAL BUSINESS TIMES: Australia investigates anti-competitive claims against the red meat processing industry
Monday, 23 November 2015
Pic source: beefcentral.com
BY Kalyan Kumar
Following complaints of anti-competitive practices in the red meat industry, the Australian government has launched an investigation into the industry's practices. A senate inquiry recently quizzed the representatives of Meat Industry Council on the goings on in the sector. The panel is expected to submit its recommendations by mid-March 2016.
The Rural Affairs Senate Committee held the hearing on Nov 17. The complaints pertained to a lack of transparency, price-fixing and information concerning pricing and weighing of cattle. The inquiry came close on the heels of processors' boycott of sale yards in Victoria over the dispute in weighing cattle before and after sales.
Chairman of the Meat Industry Council, David Larkin, deposed before the Senate panel during the hearing in Canberra. He later told the ABC that the organisation believes that returns would be better for the producers if the cattle were weighed post-sale.
He denied allegations of “collusion in the marketplace.” Larkin, while responding to the concerns over pricing, said the information is already transparent. “Prices on offer are public knowledge,” he said.
The Australian in a report said Larkin told the Senate panel that he is not aware of any collusion between buyers and sellers of livestock. But his statement was challenged by the senators. National’s senator Bridget McKenzie said the committee has significant evidence to suggest otherwise, which include allegations of boycotting the cattle sale in Barnawartha, near Wodonga, by many meat processors. The matter is also being investigated by the Australian Competition and Consumer Commission.
"We don't want to talk about it, but it happens," Senator McKenzie said.
"And Mr Larkin, if you've been involved in this industry for 32 years and you can sit here and say it doesn't happen at the buyer end or the seller end, I think is pretty rich,” the Senator noted.
Larkin said if there was evidence of collusion, “then that's a matter for the law to deal with.”
Victorian farmer Laurie Horne claimed a "shameful" collusion in place and said anyone who thinks otherwise may not have visited the sale yards. Meat and Livestock Australia's Peter Hall also denied any direct evidence and acknowledged “a lot of hearsay.”
The ACCC's Marcus Bezzi said the competition watchdog will take a serious look into the allegations of price-fixing, bid-rigging, market sharing agreements. If anyone is found guilty, they will not be spared and may face 10 years in jail, he added. Bezzi called up whistleblowers and others to come forward if they have any hard evidence on the anti-competitive practices.