Wangaratta VFF told the senate committee looking into the effect of market consolidation on the red meat processing sector that between 2000 and 2013, average per kilogram price achieved by producers at saleyard auctions grew 20 per cent while the retail price increased 45 per cent and CPI increase was 49 per cent.

Over the four-year period to 2013, processor margins grew 400 per cent.

“The scale of this disparity needs to be explained,” the Wangaratta VFF branch said in its submission.

The senate hearing will sit in Albury on Wednesday, after previous public hearings in Canberra and Queensland.

It is investigating: potential for misuse of market power through buyer collusion and impacts on producer returns;  impact of the red-meat processor consolidation on market competition, creation of regional monopolies and returns to farm gate; the existing selling structures and processes at saleyards, particularly pre- and post-sale weighing; and regulatory environment covering livestock, livestock agents, buyers and meat processors

The inquiry was triggered by the “Barnawartha Boycott” on February 17.

“As we understand it, one of the principle buyers put a written ultimatum to NVLX management at Barnawartha that if they did not intermediately employ a post-weigh system, he would not be attending the next sale,” the Wangaratta submission said.

“In the event, 10 additional major buyers, nominally accounting for 45% of normal purchases on a sale day, did not attend, without warning.”

Corowa farmer Derek Scoen, the NSW Farmers president, will be among the first urging action when the hearing opens at the Albury Entertainment Centre from 9am.

“The alternative is that we accept the processing sector will become an entrenched oligopoly with a small number of large players wielding an enormous amount of market power,” NSW Farmers said in its submission.

Other speakers include the Indigo Council, producers and industry bodies.