BY ALEX BAINBRIDGE
HOBART — Potato farmers have accepted an increase of $36 per tonne, over three years, made by potato processor Simplot. The deal was struck on September 3 after negotiations that were, in the words of farmers' leader Richard Bovill, like "dragging a big wild bull, kicking and screaming every inch of the way".
Farmers on August 1 blockaded the McCain processing factory in Smithton in support of their original demand for an extra $30 per tonne on top of the $195 they were previously paid. Farmers then threatened a simultaneous blockade of all McCain and Simplot potato factories in the country if the raise was not forthcoming.
Serious negotiations with Simplot recommenced after farmers agreed on August 16 to an offer of a $31 increase over two years made by McCain. McCain's offer incorporated a $22 increase for the coming season and a $9 increase next year.
The September 3 deal with Simplot includes the same increases and a third increase of $5 the following year. The Simplot deal includes provision for the company to buy potatoes for export at $40 per tonne less than the price for potatoes sold on the domestic market.
Some farmers were disappointed with the deals since their demand for $30 was not an ambit claim. Farmers have not received a pay rise for the last decade and would have needed $60 extra this year just to keep up with inflation.
Since the Simplot deal runs over three years, in future farmers will enter negotiations with the two companies at different times thus excluding the possibility of farmers fighting against both companies at the same time.
The third increase of only $5 per tonne is also rather modest. Bovill argues that it is better to take the offer of an increase now rather than risk getting nothing in three years. "After all, they haven't given us an increase in the last 10 years", he told Green Left Weekly.
Bovill believes that public support is the greatest asset the farmers have got and that this might not continue if they ask for large increases every year.
According to Bovill, the main justification used by Simplot to stall negotiations was that the company would be uncompetitive if the farmers' demands were accepted. Bovill told Green Left that the reality is that these companies have virtually no competition. "They buy up their competition. They control 50% of the French fry market in the world."
In practice, Bovill said, the federal government's national competition policy diminishes competition in the countryside. "It gives these [agribusiness] companies extraordinary power over their suppliers."
Bovill said that while most farmers are conservative in politics, they are not conservative when it comes to taking action and all that is required is the impetus to set them in motion.