Independents will pay

Paul Felice and Tina Felice, of Farmer Lou's in South Grafton.

Kate Matthews

INDEPENDENT retailers and fresh food producers are preparing to tighten their belts after the decision this week by mega retailer Coles to slash prices on many of its fresh food lines.

The move was greeted with dismay by independent retailers across the Clarence Valley.

Framer Lou's manager Paul Felice predicted challenging times ahead for his family-owned Grafton business.

Mr Felice told The Daily Examiner yesterday he expected to see a direct and negative impact on his business owing to the ongoing price war between retail giants Coles and Woolworths.

"It just makes it harder for us to compete. Retailers like us will be a silent casualty ," Mr Felice said.

"All we can do is focus on quality and service."

Karl Causley, the manager of Causley Fresh in Yamba and Maclean, said the latest action by Coles was nothing more than a publicity stunt.

"It's been a good year for fruit and vegetables production, and prices are generally low anyway," Mr Causley said.

"We're not particularly worried. We have the advantage of being more flexible, we can choose our products to match or beat them on a daily basis," he said.

However Mr Causley expressed concern for primary producers, predicting the farming industry would continue to undergo further rationalisation as the smaller producers could no longer compete.

"Farming is now a big business, it's no longer the lifestyle it used to be," he said.

Mr Causley said it was up to consumers to decide where they spend their money.

"The little guys, like us, keep the big guys in check," he said.

Meanwhile, CFMEU national secretary Michael O'Connor entered the national debate when he said the latest price war was likely to cause heartache for primary producers in the same way the duopoly's increase in home brand products devastated the nation's manufacturing base.

"Woolworths announced a net profit of $2.12 billion last financial year and Coles' profit was $1.6 billion," Mr O'Connor said.

"If primary producers and manufacturers are to be treated fairly, which is the position the Prime Minster put yesterday, then the Government needs to be doing more than just the ACCC inquiry into this out of control duopoly."