If you buy ginger from a major supermarket, you could be paying four times the price the farmer receives at the central markets, and the Australian Ginger Growers Association wants to know why.
- Fresh ginger is retailing at major supermarkets for $39.99-$45/kg
- Growers say they are receiving between $7-$11/kg
- Ginger growers are enjoying their best season for some time, increasing supply, leading them to ask about the price disparity
Demand for ginger spiked during the height of the pandemic and combined with a poor growing season, there was a shortage of fresh ginger worldwide over the past 12 months.
In February, fresh ginger sold for around $55-$60 a kilogram in most Australian supermarkets, with at least one customer telling ABC Rural she forked out a staggering $71.99/kg in Victoria.
Retail prices had doubled in a year and growers were paid around $20/kg for new season ginger and $30/kg for old season ginger, which spent longer in the ground and was spicier.
Supply has since increased, and Australian Ginger Growers Association president Shane Templeton said recent rain had resulted in one of the “best starts” for new ginger crops in a “very long time.”
“As of today, growers are receiving around $11/kg for old season ginger and $7/kg for new season ginger at the central markets on Australia’s east coast.”
But a price check of the three major supermarkets showed customers were still being charged $45 a kilogram for all fresh ginger at Woolworths and Coles and $39.99/kg at Aldi.
Mr Templeton said he respected that some growers could potentially be paid more through direct supply relationships with supermarkets — and he did not know what supermarket costs were.
But with 80 per cent of Australia’s ginger grown for the fresh market, he was concerned that consumers could be put off by high retail prices.
“Farmers are the ones who are putting all the work in, you’re out there in the rain, and you’re paying wages, you’re taking all the risk on and we’re the ones getting the least return,” Mr Templeton said.
Richard Shannon manages policy and advocacy for Growcom, Queensland’s peak horticulture industry group.
“For example, in the last 12 months, the price of tomatoes at farm gate has been 80 cents/kg, and in some supermarkets, it’s been $8/kg, which is a tenfold increase, and obviously difficult, I think, to justify.
“We do appreciate that there are transport logistics and a cold chain, the supermarkets themselves have their own costs, in terms of real estate, staff … but a better understanding of what it costs to get our products to market would be really helpful to better understand when these price discrepancies do arise.”
Ginger growers supply wholesale markets
In response to questions about price discrepancies from the ABC, a Woolworths spokesperson said: “Unlike other varieties of produce, for which Woolworths buys the majority through direct relationships with growers, ginger is sourced through wholesale markets, with prices set by wholesalers.”
Coles said it paid above-market prices to its direct suppliers.
“We have long-term contracts with ginger growers in Queensland and source a small volume through the markets in Sydney and Melbourne to ensure we can continue to meet customer demand year-round,” a spokesperson said.
An Aldi spokesperson did not want to comment on the factors determining retail ginger prices other than to say its “prices remained consistently lower than its competitors”.
But Growcom’s Richard Shannon wanted greater transparency of prices paid along the supply chain.
“There is no such thing as a perfect market where buyers and sellers are of equal power and influence and have the same information.
“Those are the things that characterise a well-functioning market and those markets don’t exist in horticulture,” Mr Shannon said.
An Australian Competition and Consumer Commission spokesperson said that “Neither the Horticulture Code nor the Food and Grocery Code exerts any control over the setting of wholesale or retail prices”.
The Australian Ginger Growers Association president hoped retail prices level out to reflect what growers were being paid in central markets.