Could you provide some evidence from a reliable source that this is the case, as the evidence outlined above, except processed and some limited meat products, is the contrary?
There is a lot of opinions online about supermarkets pumping meat with water before it is purchasedā¦but this isnāt plausible as the meat is processed in the same abattoirs used to supply meat to most independent butchers. Take chicken as the example, chicken is processed by a limited number if abattoirs and their meats go to the supermarkets, other meat retailers and cooked food outlets (e.g. restaurants and KFC). Some of the online opinions indicate that meat shouldnāt be bought from supermarkets as they put water into the meat, but one should buy from non-supermarket sellers because they donāt inject water into the meat. This goes against how meat is handled and processed in Australia and assumes a conspiracy that the supermarkets have injecting equipment hidden somewhere to put water in the meat between the abattoir and the consumer.
Could you also provide some evidence from a reliable source about this? The evidence from the ABC article and also the Meat and Livestock Association indicates that the recent increase in beef and lamb prices have been due to reduce supply from the farm gate. Such has little to do with price gouging of the supermarkets.
That is the case as when there is a oversupply (glut in the market), many farmer are unable to sell the excess produce that they have. When there is excess produce, the sale price is often less than the production costs and transport costs.
In such times the price within the supermarkets may also reduce, but wonāt reduce to near zero as they have their own costs that they need to cover (such as transport, distribution, storage and other handling costs) before they get to the supermarket. Local independent green grocers also reduce their prices likewise, but donāt give the product away either as they also have costs associated with carrying that particular product line.
Sometimes prices also donāt come down because the price is fixed prior to the glut occurring. This is often done to spread the risk associated with unknown future farm gate prices. It is called contract growing or futures contracts, where the produce farm gate price is negotiated at time or before planting/fruiting. There are risks of using such practicesā¦that being prices fall due to overproduction, but the paid price is high and locked in (consumers wear the risk through higher prices than the remaining market)ā¦or prices increase higher than the contracted price, and if the producer canāt meet contracted amount, may have to buy at a loss to meet contract obligations (farmer wears the risk). The supermarkets have moved towards contracts with producers so they have certainty of supply and price. Many vegetables and fruits are now contract grown under such arrangements as the supermarkets deal directly with the farmers rather than dealing with the wholesalers.
These contract arrangements can exacerbate price falling when overproduction occurs, as the size of the market to absorb this oversupply is less (as supermarkets are locked into supply contracts), making things worse.