Aussies step up transtasman food fight

The transtasman food war moved up another notch yesterday as a convoy of farmers protesting against New Zealand imports began a slow, tractor-powered drive to Canberra.

As farmers and high-powered supporters rallied in Melbourne after crossing from Tasmania, federal Agriculture Minister Peter McGauran urged major supermarket chains to buy Australian.

He has also ordered the Bureau of Agricultural and Resource Economics (Abare) to investigate the impact of foreign fruit and vegetables on Australian farmers.

A key strategy will be the advertising of processed food as Australian-made, although under the closer economic relations agreement only 50 per cent of the manufactured value needs to be Australian to enable it to be labelled as locally made.

A review of labelling compliance is already scheduled for next year by Food Standards Australia New Zealand, but Mr McGauran said the results of the Abare probe would be handed to market watchdog the Australian Competition and Consumer Commission.

"I certainly believe [supermarket chains] are in breach of their moral obligations, and their advertising about their Australianism goes against their actual treatment of Australian farmers," he told ABC radio.

"So we need to expose hypocrisy and hold them accountable and ensure that there's not some feudal system at work here, where they are the all-powerful purchaser and the farmers are the serfs."

The Tasmanians, among the strongest opponents of CER when it was being negotiated in the late 1970s, are already engaged in a bitter transtasman war over apples.

With Victorian growers, they have long applied heavy political pressure to keep Kiwi apples out of Australia on the grounds that the imports could unleash the devastating fire blight disease on their orchards.

New Zealand has taken Australia to the World Trade Organisation over the issue, supported by US and Chilean growers, arguing that Canberra is using quarantine restrictions to block competition.

The latest flare-up was sparked by a decision by McDonald's to reduce the size of its potato deals with Tasmanian farmers and to buy cheaper produce from New Zealand.

Tasmanian growers, backed by the state government, launched the Fair Dinkum Food Campaign, targeting not only Kiwi spuds but also imports of fruit and vegetables by Woolworths and Coles.

The two giant supermarket chains dominate food retailing in Australia and have long been a magnet for farmer anger because of their market power.

Growers' organisation Ausveg has demanded that the food giants accept a moral obligation to support Australian rural communities.

"The combined power of giants like McDonald's, Coles and Woolworths is forcing Australian growers to the wall," said Ausveg chief executive Euan Laird.

The group claims growers receive A$225 ($250) a tonne for potatoes, compared with the A$18,200 McDonald's earns for a tonne of fries.

Infuriated by the decision to import New Zealand spuds, farmers prepared to march on Canberra, backed by newspapers, a A$50,000 contribution from the Tasmanian Government and a bevy of MPs.

Sympathy has come from such senior politicians as Treasurer Peter Costello and Labor agriculture spokesman Gavin O'Connor.

Yesterday, eight tractors and 67 farmers from Tasmania rumbled into Melbourne for a rally outside the state Parliament addressed by protest leaders and Tasmanian Premier Paul Lennon.

The convoy was moving at roughly 40km/h towards Canberra, about 2000km to the north, where protesters hope to be joined by hundreds of supporters early next month.

A spokeswoman for New Zealand Trade Minister Jim Sutton said Australians were feeling the effects of globalisation. Prime Minister Helen Clark said New Zealand was clearly able to export potatoes to Australia and people would make commercial decisions as to whether they bought them for their businesses.

"If people want to mount individual boycotts I guess that's their privilege, but I'm sure that those buying the potatoes will be doing so on value and quality, and they are unlikely to respond to a call like that."