By Shane Schnitzler, Fresh Markets Australia Chair
At a time when costs are rising and the compliance burden is growing; we need to reflect on the things which truly add value to our supply chain.
In the fresh produce industry, of which I have proudly worked in for more than 35 years, I have seen how the supply chain comes together in adding value and ensuring produce gets to the consumer as efficiently as possible.
Whether it is sending berries for export, getting mangoes ready for market, or ensuring avocados are delivered to cafes, each section of the supply chain plays a critical and practical role.
As Fresh Markets Australia (FMA) Chair, I also see and hear the rising cost impacts on each section of the supply chain. Some of which we can’t control, such as fertiliser, fuel and energy, but some of which we can – administration.
Grower body AUSVEG highlighted some of these concerns in its report in late 2025, Horticulture Compliance and Regulation: Reducing the burden by 2030. The report estimated its average annual compliance cost for the Australian vegetable industry was about $213 million per year.
Now some of that compliance is absolutely necessary, food safety, ag chemicals, quality are critical. We need to make sure our produce is safe for the consumer to enjoy. But some of it needs further review.
This is why one of FMA’s core reform principles for the Horticulture Code of Conduct (the Code) review has been to ‘Modernise the Code through simplification’.
Removing duplication and streamlining requirements that add cost without improving outcomes and simplifying Code related paperwork and processes are central to ensuring that the Code is not a burden.
FMA is fully committed and supportive of the mandatory Code and the Code review which is underway. However, when we have opportunities like this, we must pause and reflect and think about what is the problem we are actually trying to solve?
The Code was established to regulate trade in horticulture produce between growers and traders, ensuring transactions are transparent and clear.
Piles of paperwork which either goes unread, or is not understood, does not necessarily mean that core purpose of the Code is being met.
As any business owner knows, time is valuable and time is a cost.
KordaMentha’s analysis of the FMA Member Survey, completed , earlier this year, highlighted that the average trader business was impacted 15.20 hours per week and around $38,500 annually, just on grower reporting, with a lot of that time being spent inputting data from the thousands of transactions that have occurred during that week.
Simplification of the Code can help ensure what the Code requires is used and is of value to the grower and trader businesses which operate under the Code each and every day.
This will in turn leads to growers and traders seeing greater value in the Code.
The Code is there to support trade, not hinder it.
That means not creating change for the sake of it.
One reform that has been raised through the submission process has been the role of Merchants and the use of the method/formula pricing model.
KordaMentha’s economic analysis shows is not a niche practice. It is critical to central market trade and is used by the majority of merchants.
The survey found that 87 per cent of traders operate solely as merchants. Among merchants, 69 per cent use formula/method pricing under their grower-trader Horticulture Produce Agreements (HPAs). Of these, 41 per cent use it exclusively and 28 per cent use both formula/method and agreed pricing.
Often what gets forgotten in these debates, is that HPAs are exactly that – agreements between growers and traders.
They set out the commercial terms, including how the price will be determined. If the proposed HPA terms do not work for either party, they can negotiate different Code-compliant terms or choose not to accept the agreement and seek trade with another grower or trader.
Calls to remove Merchant method/formula pricing overlook how the fresh produce market operates and the strength of the grower-trader relationship.
The industry has come a long way since the 1960s.
This is why FMA’s position has always been clear, let’s simplify the Code and make it workable for growers and traders – exactly what it was first set up to do.
The Code is there to work for industry, not add compliance and cost for no result.
