With the public consultation and stakeholder engagement process now complete, the recommendations regarding the Horticulture Code of Conduct (Code) review are still in the hands of the independent reviewer Mr Chris Leptos AO, who is expected to release his report later this year.
Throughout the review process, Brismark has advocated for a Code that reflects the evolution in business practices over the past 20 years, and that is flexible and fair in its application to all parties.
Brismark CEO Andrew Young said that the organisation commissioned Roy Morgan to undertake a survey of Australian Growers to inform its submissions to the Code review, in addition to meeting with the independent reviewer Mr Leptos and industry groups to communicate feedback and concerns from Brisbane Markets Wholesalers.
Mr Young has said that according to the Roy Morgan Research findings, there is strong support amongst growers for increased flexibility in commercial agreements, with 81% of growers surveyed supporting a formula-based pricing model with the return price paid to the grower based upon the sale price less an agreed margin.
“Removing this option will reduce flexibility and financial returns for growers,” said Mr Young.
“Growers can lodge a complaint if they believe a breach of the Code has occurred, and there are penalty provisions in place if a Wholesaler is found to have breached the Code and not disclosed the actual sales price or not acted in good faith.”
Mr Young also suggested that a deemed agreement or terms should be implemented, with traders publishing or lodging their base standard terms which become the default if a Horticulture Produce Agreement (HPA) has not been signed.
“There are legal risks faced by traders just because a grower may, for whatever reason, not execute and return a HPA, while continuing to send supply to the trader,” said Mr Young.
“Having a deemed agreement or terms will remove this unreasonable, indirect and “forced” non-compliance that puts traders at risk legally.”
With only two-thirds of growers surveyed by Roy Morgan saying they were aware of all or most of the current Code requirements, deemed agreements or terms should be a welcomed change by both growers and Wholesalers.
“If a Wholesaler or grower wants to establish more favourable terms, then they should be able to do that by accepting a HPA in writing,” said Mr Young.
Another area of focus is the extension of the Code to all first point-of-sale transactions involving growers, where the Food and Grocery Code of Conduct does not apply. Brismark believes consistent application of the rules across the sector could help create a more level playing field and strengthen confidence in the industry’s regulatory framework.
“There is now a lot of fragmentation and diversification of fresh produce supply chains, and it is both justified and necessary for the Code to apply to all transactions that are the first point-of-sale with a grower, except of course where the Food and Grocery Code applies,” said Mr Young.
Mr Young said Brismark has been supportive of the review process and looks forward to an outcome that delivers fairness and practicality and reduces regulatory burden. He added that any revised Code should continue to recognise that growers and Wholesalers both play an important role in maintaining an efficient, transparent and sustainable supply chain, and it is important that the industry operates under a framework that is fair and workable.
See Brismark’s Code Review submission and the Roy Morgan Research Survey of Fruit and Vegetable Growers.
