John Murphy: Vegetables NZ Chair on the Commerce Commission's grocery report

New Zealand’s produce providers are hoping for a bit more information regarding the supermarket industry. 

The Commerce Commission's first annual report into the grocery market, shows competition hasn't meaningfully improved. 

It flags increasing margins and high profitability. 

Vegetables NZ’s John Murphy told Mike Hosking that it would be great if growers got more of a slice of the pie, given the commercial risk they undertake. 

He said that better market information would be helpful, but if the government is to intervene, they need to be really careful to ensure the real world outcomes are of benefit to consumers and to producers.  

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Episode Transcript

Speaker 1 (00:00):
What did we get out of our first supermarket report
from the Grocery Commissioner. Well, he doesn't like the look
of the market. He claims the margins are up and
the profits are too high. He's talked about tools and
how to use them. Anyway, Vegetables New Zealand share John
Murphy's backward This John, very good morning to you.

Speaker 2 (00:13):
Good morning Mike.

Speaker 1 (00:13):
Do you have a view on the report?

Speaker 2 (00:16):
Look, it would be great if grower has got more
of a slice of the pie, given the commercial risk
that we take and that right now we're doing it
pretty tough. But I think better market information would help,
and including trade spends in the information that comes out.
But ultimately we need to work with supermarkets to get
more vegetables on kiwis plates right.

Speaker 1 (00:38):
The view of the market is it broken as it's
being suggested it is? Is it any different this year
than it was last year when this bloke started his job.

Speaker 2 (00:47):
Look at early days for the Grocery commission And I
don't think you can magic a transparent market out of now,
and so as I say, I think it's about better
reporting and better information so that the market can function properly.
I don't like the idea of market intervention in the
wholesale market necessarily, I don't know that that will lead

(01:08):
to a more dynamic market that people are talking.

Speaker 1 (01:10):
About, who would interfere with it and how would they interfere?
Do you have any understanding of that, because I don't.

Speaker 2 (01:18):
Look, it's really hard to see what that would look like.
But I think River you have government intervention, you've really
could be careful that the real word outcomes are a
benefit to consumers and also to produce us.

Speaker 1 (01:31):
See the difficult point part that you're in as far
as I can work out, and you're involved in the
inflationary numbers and stuff. If it rains a lot or
doesn't rain a lot, you're directly affected by the amount
of stuff that you can produce. The amount of stuff
that you produce effects directly the price a lot of
that's beyond anybody's control, isn't it.

Speaker 2 (01:48):
Correct? And look, we do everything we can to be
more productive every day and to deliver more freshlty vegetables
to New Zealanders. That's our job. How the market operates
beyond the farm gate is important to us and as
a part of our cost structure. But that we're really
focused on what we can do ourselves and look at it.

(02:08):
It's good to see supermarkets committing to initiatives like five
plus a day and need one more vegetable. We went
similar to that, but I think that more information is
really the key here.

Speaker 1 (02:21):
All right, good insight, John, appreciate it very much, John Murphy, Vegetables,
New Zealand Chain. For more from the Mic Asking Breakfast,
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