AFGC renews call for Government action on factory closures

Posted by AFN Staff Writers on 9th January 2012

The Australian Food and Grocery Council (AFGC) has again called upon the Australian Government to take action to help Australian food manufacturers cope with “immense pressures” on their business.

The AFGC’s call coincides with last Friday’s closure of Heinz Australia’s tomato sauce factory in Girgarre, Victoria. Despite the Girgarre closing, Heinz Australia continues to manufacture in the Goulburn Valley region through its baby food factory in Echuca.

AFGC Chief Executive Kate Carnell said today that Australian food and grocery manufacturers were under more pressure than ever, due to the rising cost of labour, energy, water, transport and high commodity prices.

She also said that the high Australian dollar is making imported products cheaper, making it even more difficult for Australian-made brands we know and trust to compete on Australian supermarket shelves.

Call for Government action

Ms Carnell said to maintain industry’s competitiveness, the Australian Government needs to provide tax incentives to enable businesses to take advantage of the high Australian dollar to invest in large-scale plant equipment upgrades to improve efficiency.

Ms Carnell also said that to ensure a fairer trading environment, the Australian Government should appoint a Supermarket Ombudsman, who would enforce a Fair Trading Code of Conduct.

“I urge all political leaders to seriously consider the necessary reforms and re-assess the current business-as-usual approach towards the sector,” Ms Carnell said.

“The time for a new policy menu to encourage investment, innovation and growth is now as the jobs and livelihoods of 312,000 Australians, and the future of our food supply, depend on it.”

Heinz announced in May 2011 its plans to close the factory in Girgarre, Victoria, as well as plans to downsize its factories in Northgate, in Brisbane, and Wagga Wagga, in New South Wales.

In August 2011, Heinz also reported a six per cent decrease in net income to US$226 for its first quarter.