ACCC authorises co-operation between supply chain rivals

Competition watchdog Australian Competition and Consumer Commission (ACCC) has given freight companies special permission to co-operate to get groceries into Western Australia and the Northern Territory, after supply chains broke down.

The ACCC has granted an urgent interim order allowing companies involved in the supply chain to cooperate and share information – something that would otherwise be in breach of competition laws.

The move follows major flooding in parts of South Australia last month, which interrupted rail and road networks, limiting the supply of critical goods, including groceries.

The main rail line between SA and WA was only reopened on Tuesday after work to repair 18 separate breaks across about 300 kilometres of track.

Acting on an authorisation application from Linfox, ACCC’s ruling applies to a number of other groups including Pacific National, One Rail and major grocery retailers.

It also could apply to a broader range of businesses including retailers, wholesalers or other transport services.

Companies will be able to meet to identify which retail products are critically required in WA and NT and prioritise their supply by road, rail, sea or air freight, including the development of stockpiles if required.

The orders also allow groups to work together to identify and ensure critical products from WA and the NT are supplied to other jurisdictions.

“There is a risk of critical shortages of retail products in WA being compounded by a possible rise of COVID-19 cases that might affect workers in the transport, logistics and retail industries,” said Mick Keogh, Deputy Chair at ACCC.

“Allowing this authorisation will likely result in public benefits by giving those in the supply chain the opportunity to maximise consumer access to retail groceries, reduce community concerns, and reduce strain on retail supply chains,” Keogh said.

January 2022 saw a once-in-200-years weather event in SA, which led both Coles and Woolworths to impose temporary purchase limits for WA customers on a range of goods including pasta, rice, flour and sugar.

WA Transport Minister Rita Saffioti said it would take some time to address the significant freight backlog.

“We expect another four to six weeks until all the lines are available in the stores, as a result of trying to clear the backlog from over east and also making sure the distribution centres are full again,” she said.

During the rail outage, 55 triple-road trains had brought essential goods across the Nullarbor while some retailers contracted shipping lines to bring in containers of food, with the first ship due to arrive in Fremantle next week.

Saffioti said there was a recognition at a national level that shipping should play a greater role in shoring up supply chains and that roads needed to be upgraded.

She also called for greater flood-proofing of the rail network to prevent such disruption in the future.

In case you missed it: Freight flows again on flooded Stuart Highway

with news from AAP