Ballarat potato industry fears impact of cheap frozen fries dumped on the market

For the Ballarat region, which has historically been abundant with potato farmers - from Bungaree to Dean, Trentham and everywhere in between - it could mean hundreds of job losses.

The imports would not only affect the viability of potato farming for farmers themselves, but would continue down the line and would mean job losses from the agricultural suppliers, to the contractors who harvest the crop and to those who work in potato plants.

As restaurants and other food services have closed their doors across the world due to the coronavirus pandemic, farmers and processors have been left with nowhere to sell their produce.

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This is the case in the EU, where processors have an oversupply of potatoes - which they are attempting to offload into the Australian market in the form of French fries.

The representative body for Australian vegetable and potato growers, Ausveg, on Thursday wrote to several cabinet ministers and elected officials on behalf of the nation's potato industry.

Ausveg is urging the federal government to intervene in order to limit the importation of the heavily discounted frozen fries from the EU to protect the Australian industry.

Chairman of the Central Highlands Potato and Agricultural Group, Chris Stephens, said these were already unprecedented times but if the imports were to be brought into Australia, it could mean the end of the nation's potato industry.

Each year Australia grows about 1.4 million tonnes of potatoes, with about 100,000 tonnes of processing potatoes grown in the Ballarat region.

About 75 per cent of potatoes consumed in Australia are grown in our soil. It is a figure the Australian potato industry would like to see grow, despite the ongoing threat of cheap imports.

European growers - the world's biggest exporter of frozen potatoes - are highly subsidised to grow potatoes so there is an abundance of them and they are able to offload them for a small price.

Australia is an attractive option to export frozen potato products to, as a nation which consumes the world's second highest amount of frozen potato products per capita.

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For Australian growers, potato farming is expensive and it is difficult to make ends meet as it is.

So if European growers were to dump their frozen fries here over multiple seasons, at prices up to 80 per cent below market price, it would be almost irresistible for food service operators.

This would significantly undercut Australian growers, with the industry fearing it could force some to grow alternate crops, or out of farming all together.

"We can't produce potatoes anywhere near as cheap as what they can in other parts of the world due to the fact that we import pretty much 90 per cent of inputs - fertiliser, chemicals and parts of machinery because nothing's made here anymore," Mr Stephens said.

These excessive costs and trying to make a return is what has pushed many of the once dozens of potato farming families across the region away from potato growing - a high input, high return crop.

"You need two things to be sustainable - a price above the cost of production and a quantity of tonnes that you can grow to be able to stay ahead," Mr Stephens said.

"We're just sitting above the red line at the minute. As growers we're only just making enough to make a living."

Mr Stephens said potato growers always needed to plan at least a year ahead for the next season, so if potato plants were to shut down due to the number of imports - even temporarily - there would be a mass exodus from the industry.

"I've never seen spud growers give up for a couple years and then come back and grow them again, it's just too difficult. You're either in it or you're out. And that's the sad fact of it."

Potato farming is highly specialised and across the region has seen growing knowledge passed down through generations.

Decades ago potatoes were a huge source of income across the region - from seed growers to potato growers and that wealth was shared across the region with sporting clubs, machinery businesses and so on.

If these imports were allowed, it could signify the end.

The region's potato growers are already struggling from the impact of coronavirus. While some McCain suppliers were able to harvest and store their potatoes there, others who supply other businesses which have since shut down and did not have a chance to harvest them due to the weather, lost out.

"The reality is they're going to take a massive financial hit and it could break some people," he said. "But the government can do something about it."

Mr Stephens said growers had tried to push for tariffs on imports in the past in order to protect the industry, which has continued to struggle to compare to more attractive cheaper imports, though it had never eventuated.

But the fact major processors such as McCain were now supporting this meant the Australian industry was really under threat.

"We are calling for the Australian Government to stand up and to protect its agricultural industries."

Mr Stephens said the government had not taken food security seriously enough in the past, but this could be the wake up call it needed.

"If we don't protect our industry, then we'll be having to buy food from other countries around the world. And if the dollar is low, then we're going to be paying a lot more for it than what we can produce it for in Australia, for a far less quality product."

Ausveg chief executive, James Whiteside, said imports flooding the market would add an undue burden to the viability of local businesses and the processors who support them.

"This pandemic has highlighted the importance to Australia of having secure and local food supply chains," he said.

"Industries such as the Australian processing potato industry, which are vibrant and profitable in normal times, must be protected from dumped European product if the government is serious about food security."

Ausveg has been working with major potato processors, McCain Foods and Simplot, in order to address the potential issue.

A McCain spokesperson reiterated that the arrival of imported product from Europe would be 'catastrophic' for the region's potato growers.

"It poses a risk to our business as a processor and the thousands of regional jobs we support.

"If hundreds of thousands of tonnes of frozen fries are allowed to be dumped on the market, growers may need to seek alternate crops and this means Australia's fresh potato supply is under threat.

"As an industry we don't want to see unfair competition, we just want a level playing field."

Australia is entitled under international law to rely on Article XXI of the General Agreement on Tariffs and Trade (GATT), which allows us regulations to be imposed in times of emergency.