Concerns remain over grocery chain buying

By Kirk Starratt

kstarratt@kentvilleadvertiser.ca

NovaNewsNow.com

A group of Kings County farmers are speaking out on an anonymous basis about food procurement practices of major retailers damaging their operations and our local economy.

They decided to express their concerns following the response of a major retailer to a protest in support of local corn producers held in New Minas, Thursday, Aug. 7, as reported on Page 2 of the Tuesday, Aug. 12, edition of The Kings County Advertiser. The reason for speaking anonymously is a fear that speaking out could jeopardize future business with the major buyers.

Hillaton farmer Ron Clarke, a Kings County Federation of Agriculture past president, met with the concerned farmers and agreed to represent their concerns as spokesperson.

Clarke said a lot of local producers have observed the buying practices of the big retailers and have noticed trends in how sales on imported produce seem to be timed to coincide with the start of locally-grown produce becoming available.

One producer said the chains appear to know exactly when certain local produce becomes available. The stores seem to bring in a large quantity of similar imported produce and price it low at the beginning of local harvest seasons, saturating the market with low-priced product. This puts pressure on the competition and drives the price down across the board. “The price drops like a stone,” one farmer said. “They get what they want for the price they want.”

Hurts competition

These sales hurt individual farmers, smaller retailers and farm markets because the only way to compete is to drop prices, leaving less money in the pockets of local producers and our local economy, which is based on agriculture. Aside from the major retailers, the only outlets farmers have are roadside stands and farm markets.

All producers are hurt, whether they deal directly with the major retailers or not.

Crops have to be packaged and marketed within days of ripening or they’re a total loss. Some producers said this had led to situations where they have to sell to the major retailers at the price dictated just to recoup some of their costs of production.

One producer recalled an incident where the retailers had apparently agreed to hold the same price on a given product for a given week. However, a sales flyer came out with the unit retail price listed 20 cents lower than what had been agreed on. Other retailers had no choice but to match the lower price and the producer lost $7,000 as a direct result.

One farmer said the prices at farm markets give producers a fairer return but you can expect to lose sales because of lower prices at the major retailers. The price differential can only be so much before people decide the lower price is more important than quality or supporting the local economy.

However, the producer pointed out that at least he gets the retail price by selling at a farm market. If the retail price is that much lower at the major retailers, you know the farmer is only getting a fraction of that.

Buy retail, sell wholesale

One farmer quoted the late US president John F. Kennedy, who said the farmer is the only businessperson who buys everything retail, sells wholesale and pays the freight both ways.

In essence, the concerned farmers believe the influence and buying power of consumers is critical to changing the current procurement culture of the major retailers. As one said, “The consumer is the only one who can make a difference.”

The individual said there is certainly nothing illegal about the current procurement practices of the major retailers, but many farmers believe it isn’t morally correct.

Another said, “if consumers were only willing to buy local, and empower farmers, it would help change the balance of power.” The farmers expressed thanks to those consumers using their buying power to make a difference.

If farmers were making good money farming, they wouldn’t be tempted to use good quality agricultural land for other purposes, including residential development.

Clarke summed up the concerns of the farmers by stating, “If you’re buying (based) on a cheaper price, there is a price to be paid. It affects the economy.”