Potato growers fear deregulation

Brad ThompsonThe West Australian
Potato growers fear deregulation
Camera IconPotato growers fear deregulation Credit: The West Australian

John Omodei hopes that one day his five-year-old grandson Raphael becomes the fifth generation of the family to grow potatoes in the South-West but he knows the industry faces an uncertain future.

The life-long potato grower said the Economic Regulation Authority's recommendation that the State Government deregulate the industry had created an unhealthy climate of uncertainty.

The ERA wants the Potato Marketing Corporation abolished through the repeal of legislation controlling the industry. Growers fear the move will leave them exposed to big price fluctuations, more exposed to the power of the supermarkets and left holding worthless licences linked to the existing quota system.

WA growers produce about 60,000 tonnes of potatoes a year under quota licences issued by the Government's PMC. The quota licences change hands for up to $500/tonne and are worth a total of about $30 million.

The Government continues to allow the trade in licences despite the push for deregulation but the bottom is dropping out of the market.

Mr Omodei recently paid $400/t to increase production and, like others in the industry, believes growers should compensated if the Government does deregulate.

"To increase production we have gone with the system and bought the licence," he said.

"I haven't got the power to say to (Premier) Colin Barnett you have to pay me compensation but, like others, I have stuck my neck out for licence to grow more product. There should be some compensation for that."

The Pemberton farmer said he was a "commercial realist' after leaving school at 13 and growing potatoes for every one of the past 51 years.

"The PMC has been good to us. It sets the price, it doesn't flood the market and it now supplies consumers with a broad range of varieties," he said.

Mr Omodei said it was naive to think the supermarket giants would not exert even more influence over the industry if the PMC was abolished.

Coles and Woolworths have started taking up plant breeder rights' on their preferred varieties of potatoes, meaning growers pay a royalty when supplying to the supermarkets.

It is understood Coles wants yellow fresh potatoes, such as its charisma variety, to make up 60 per cent of the potatoes on its shelves within the next few years.

Mr Omodei said that regardless of what happened, his family would keep digging potatoes.

"We have too much tied up and consumers will still want potatoes," he said.

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