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Assisting farmers requires fine balancing act by ACCC

Comments on Michelle Grattan "Government to beef up ACCC to assist farmers", 5/07/2015

You have made a very good point Mr Arnold. The ACCC will have a dilemma on its hands. It has to balance the interests of consumers as its traditional mandate implies and that of farmers that is the government now wants it to do.

Consumers benefit from lower prices of agricultural goods through lower costs of supermarketers on the one hand. On other hand, the task that the government has given the ACCC to look after the interests of farmers would force up the prices that those supermarketers pay to farmers, that ultimately will be reflected in higher prices that consumers have to pay.

It will be interesting to see how the ACCC will handle and act with such diabolically opposite objectives. Of course, there is a possibility that the heavy weight supermarketers may not pass the lower costs to consumers but profiteer it for its own profits.

I guess in that case the ACCC should and can easily force the supermarketers to act in a competitive way as opposed to using their market power in front of consumers.

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