Calls for Australia’s antitrust regulator to be granted authority to break up supermarket behemoths Woolworths and Coles resounded in a Senate inquiry.

The National Farmers Federation Horticulture Council, representing growers, decried the dominance of the “large corporate duopoly,” insisting that divesting assets from these giants could inject much-needed competition into the market and benefit both producers and consumers.

“The ability to divest, from a government policy point of view, should never be taken off the table,” said Council member Jeremy Griffith during the inquiry’s hearings.

“From a competition point of view, in five years time, we could be in a lot more competitive position than we’re in now.”

Market dominance

The spotlight has intensified on Woolworths and Coles in recent years, with concerns about their market dominance exacerbated by two years of high inflation. The combined grocery sales of these giants account for approximately two-thirds of Australia’s market, rendering it one of the most concentrated in the world.

Despite repeated calls for change, the centre-left Labor government has not disclosed its stance on potential reforms, while the rural-focused opposition party, the Nationals, has rejected compulsory breakup proposals.

Representatives from Woolworths and Coles were not immediately available for comment, but they defended their operations in written submissions to the inquiry, citing Australia’s highly competitive grocery sector with some of the world’s lowest profit margins.

They also highlighted newer entrants like ALDI as contributing to competitive pressures.