Tassie growers spitting chips over Simplot spud contract

• Tasmanian potato growers have rejected a price reduction from multinational processor Simplot that would significantly cut their returns despite high production costs.
• Simplot has bypassed the official grower negotiation committee to pressure individual farmers into signing incomplete contracts within a strict seven-day deadline.
• The dispute has led to cancelled contracts and reduced potato volumes, leaving approximately 150 growers facing financial pressure and uncertainty ahead of the planting season.

Tensions between U.S. multinational Simplot and Tasmanian potato growers have reached a breaking point just weeks before the early planting season for French fry potatoes begins. A long-standing stalemate over contract terms has escalated significantly after the frozen chip manufacturer abruptly ended price negotiations for the upcoming season.

The conflict centers on a proposed price reduction that growers argue is unsustainable. If accepted, the new rates would represent a 57 percent drop in returns for farmers compared to just two years ago. While potatoes are Tasmania’s most valuable agricultural commodity, they are also the most expensive to cultivate, costing roughly $25,000 per hectare or 42 cents per kilo to produce. Simplot’s current offer sits between 46 and 49 cents per kilo, leaving growers with razor-thin margins that many say do not justify the financial risk.

Beyond the financial figures, farmers are increasingly alarmed by Simplot’s recent conduct. The company has already slashed potato volumes and cancelled several contracts, but it is their latest negotiation tactic that has caused the most friction. In a move described as unprecedented, Simplot bypassed the official grower committee—which traditionally negotiates on behalf of 150 farmers—to approach individual growers directly with incomplete contracts.

These individual farmers were reportedly given only seven days to sign agreements without first seeing the full supply agreement or updated terms and conditions. Simplot further stipulated that after this one-week window, it maintained the “sole discretion” to either accept or reject the farmers’ supply. Nathan Richardson, chair of the TasFarmers vegetable council, stated that these tactics have placed massive pressure on local families. He warned that forcing growers to sign under such duress is a significant departure from fair industry standards and undermines the stability of the state’s vegetable sector.

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Original article and photo by "ABC News"