In a letter to agriculture minister Joe Ludwig, SPC’s managing director, Peter Kelly, called for protection measures to protect an industry in dire trouble.
Last week SPC told farmers in Victoria’s Goulburn Valley fruit growing region that their production quotas would either be suspended or significantly reduced. The canning company blamed the high exchange rate for the Australian dollar as well as the spate of imports into the country.
"The multi-serve fruit and canned tomato industry has suffered immense damage from cheap imports that have flooded our market on the back of the strength of the Australian dollar," Kelly said in the letter, which was quoted by News Limited.
Such action, if taken, would come under special protection measures permitted under World Trade Organisation rules. They allow a government to act where a glut of imports threatens damage to a domestic industry.
SPC has already rationalised its fruit canning factories in the Goulburn Valley and is now the only tinned tomato processor in Australia. Farmers in the region will conduct two mass meetings to discuss their future prospects.
Meanwhile, the federal government has announced it will provide A$60 million in loans over two years to help farmers across the country restructure their debts. Many of the Goulburn Valley farmers are expected to apply for these.
Senator Ludwig said the government would “boost support and assistance” to Australian farmers with acute levels of debt with a new package of measures to support the rural sector.
“The high dollar and depreciation of land values are putting significant pressure on many farmers, leaving otherwise viable farms facing serious difficulty to stay operational,” said the senator as he launched the Farm Finance initiative.
“Farm Finance will help strengthen Australia’s agricultural sector, making sure all Australian farmers can take full advantage of the opportunities ahead.”
The package sets out to reduce debt repayments in the short-term, while concessional loans targeted at restructuring debt will also be available from. The government will make a loan of up to A$60m over two years to delivery agencies in each state for the provision of concessional loans, with each farmer able to receive up to A$650,000.
Farm Finance will also increase the number of rural financial counsellors, harmonise the industry’s approach to farm debt mediation and extend farm management deposits. The programme will launch on July 1.