The Australian Food and Grocery Council (AFGC) is calling on state and federal governments to act on soaring energy prices with costs expected to rise up to 300 percent.
According to an AFGC statement, the increase in gas and electricity prices adds additional strain to Australia’s food and grocery manufacturers, already struggling with the impacts of Covid-19, natural disasters and the war in Ukraine.
Michael Perich, CEO of Noumi, which employs approximately 600 people and produces the MILKLAB range of plant-based milks, said gas price rises are “unsustainable.”
“We are currently facing an unprecedented and unsustainable four-fold increase in our contracted gas prices … It’s no exaggeration to describe this as a national energy crisis.”
AFGC CEO, Tanya Barden, said gas prices need to be capped to protect the future of Australia’s $134 million food and grocery manufacturing sector.
“The vast majority of food and grocery manufacturers purchase gas on the retail market rather than the wholesale market and so consideration must be given to making the code of conduct governing gas supply agreements mandatory and extending it, along with price caps, to cover retail pricing,” she said.
“While wholesale price caps are important, manufacturers are exposed to retail pricing and they are incurring huge increases in the cost of gas that undermines the long term future of Australia’s largest manufacturing industry.”