Tasmanian Simplot potato growers suffer an average 2.5 per cent pay cut with new contract

Most Tasmanian Potato growers who supply spuds to Simplot have signed contracts with the company that TasFarmers says have resulted in an average 2.5 per cent price cut for farmers.

TasFarmers Chief Operating Officer Neil Grose said that Simplot gave growers until 5pm on September 15 to sign their contracts.

Mr Grose said Simplot reiterated that not signing by the deadline would mean growers had decided not to grow and their volume would be allocated elsewhere.

He said he understood that most farmers had signed the contract at 4.45pm on September 15.

Mr Grose said that one of the farmers who did not sign the contract was “a fairly large grower who’s just not going to grow spuds”.

However, he did not say who the grower was for privacy reasons.

“This is an incredibly difficult situation for Tasmanian family farmers who grow spuds for Simplot,” Mr Grose said.

“While seeing a 2.5 per cent cut to the average price was hard enough, to lose their contract would be devastating to growers.”

Mr Grose said Tasmanian farmers had always held the health of the potato industry as their prime concern, so growers and processors can both thrive.

“Unfortunately, the price cut, and Simplot’s conduct through this process, shows that Simplot only has concern for their own bottom line.

“At a time when agriculture is under unprecedented cost of production pressure, Simplot has cut the price to the very sector upon which their profits rely on.

“Despite the cut to growers, the final product is now more expensive to buy at the supermarket and fast food outlet.”

Tasmanian potato growers have a collective investment in Tasmania of over $1.8B, spanning farmland, machinery and other cropping infrastructure.

Mr Grose said that despite Simplot’s processing future in Australia relying on farmers continuing to invest, continual price cuts and rising costs could place that in jeopardy.

“Potato growing in Tasmania is an incredibly vital industry for the state.

“Cropping puts significant and much needed economic activity into our regional areas but cutting prices to farmers places the economic vitality of the whole state at risk.

“Short-term price cutting does nothing for the long-term prosperity of our agricultural sector – Tasmania’s farmers need a fairer deal.”

Simplot has been contacted for comment.