Where are supermarket products sourced?

More and more of our groceries are coming from overseas.
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01 .Introduction


Coles and Woolworths say they're committed to sourcing their private label products from Australia. But as CHOICE discovers, this isn't the whole story.

CHOICE looked at more than 360 products across popular grocery categories, including cereals, biscuits, snacks, tinned goods and frozen packaged food, matching private label products to their market leader equivalents. 

Of products we surveyed, just 55% of Coles’ products and 38% of Woolworths products were locally made or grown, compared with 92% per cent of market leader groceries. We included any product that was made in Australia or included Australian-grown ingredients. But these products may still include other ingredients from overseas.

Interactive map

Click on the coloured pins to find out which products are made where. View CHOICE County of Origin in a larger map, or download our table for even more detail.

 key-red Coles 
 key-green Woolworths
 key-blue Market leader

Around the world

For products to claim they are "made" in Australia, the product must have undergone substantial transformation and 50% of processing costs here. If the product includes ingredients from outside Australia, or the specified country of origin, "imported ingredients" must be noted on the packaging, however the exact source of such ingredients is not required.

Australians are predicted to spend $85.9bn on groceries this financial year, with private label sales expected to account for just over one-quarter of this amount – double what we spent on home-brand products five years ago. While dry grocery items and chilled packaged food categories have proven themselves the strongest private label performers over this time, raising supermarket profits but also question marks over where they come from. While a commitment to Australian products is evident in the fresh produce sections of the big two supermarkets, this loyalty is not so easy to find in some other aisles.

Coles told CHOICE it has an Australia first sourcing policy that extends to all private label products, of which it claims 90% are locally made or grown. According to the 2011 All About Coles report, “we will always try to source products locally and only import if Australian supply is insufficient to meet our customers’ needs”.

Similarly, the Woolworths Sustainable Strategy for 2007-15 claims Woolies remains “committed to our long-standing policy of giving preference to Australian vendors who can meet our supply requirements” and promises preferential trading terms to local vendors for private label goods. It claims 90% of its Homebrand products are from Australia.


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In the past, if you had a bad year, you could balance it out the next year. We can’t say that now. There’s far more [produce] in Australia than we can actually sell because of all the imports coming in.
- George Anderson*, vegetable farmer

Research by Roy Morgan in 2009 suggests Aussie shoppers rate local products highly, with 89% saying it is important the food they buy is Australian and 82% saying it’s important this food is packaged in Australia. Similarly, 83% of CHOICE members surveyed in 2011 told us that buying Australian-owned is important to them.

While Coles and Woolies claim their buyers only look to overseas markets when local suppliers are unable to meet demand, farmers tell a different story.

George Anderson* has been a vegetable farmer all his life. If you’ve ever purchased a basket of fresh veggies from Woolworths, chances are you’ve probably eaten produce from his Tasmanian farm. If you haven’t, your chances are fast diminishing. In more than 30 years of farming, Anderson says things this year are particularly dire.

Anderson estimates up to 50,000 tonnes of potatoes and a further 20,000 tonnes of other vegetables, including carrots and onions, will go to waste in Tasmania this year. He says this is due to increasing numbers of imports arriving on our shores.

“The situation we’re in now is probably the worst I’ve ever seen,” he told CHOICE. “In the past, if you had a bad year, you could balance it out the next year. We can’t say that now. There’s far more [produce] in Australia than we can actually sell because of all the imports coming in.

“Farming in Australia is going backwards by the week. You’ve got very few major processors left here, so the product has to come from overseas. If things keep going the way they are, people won’t have a choice when it comes to frozen and tinned goods because there won’t be any Australian produce left to buy.”

Woolworths affirms its commitment to the future of rural Australia on its website, but our analysis of its processed fruit and vegetables – the kind you find in tins or in the freezer section – suggests otherwise. Of the nine frozen vegetable categories we looked at, 13 of the 14 Woolworths private label products were sourced internationally. Similarly, 19 of their 21 tinned fruit and vegetable products came from overseas.

While the frozen potato products from market leaders we examined were made in Australia, the same can’t be said for Woolworths branded products. Frozen chips across both the Select and Homebrand tiers, as well as Woolies’ potato wedges are processed in the Netherlands, some 16,000km away.

Coles also sources some frozen and processed vegetables from overseas, but this year has moved towards Australian produce across a range of frozen goods, including corn, broccoli and peas – a move Coles says has been well received by customers.

By invite only

“You can’t expect the big two to be benevolent organisations, but there are extremely significant farms in this country that aren’t even being given the opportunity to bid for their contracts,” says William Churchill, spokesperson for Ausveg, the Australian farming industry body. “I know some of the biggest bean growers in this country weren’t even aware of [private label] contracts.”

Woolworths says its tender process for private label goods is by invitation only – something farmers believe is less than ideal. “We don’t find out – it is not a public document,” says Mitch Ball*, a Tasmanian farmer who supplies Woolworths with fresh produce year round.

“The challenge for the government is working out how they can level the playing field. We’re as good as producers anywhere else in the world yet we are going broke.”

Churchill agrees more must be done to connect private label supply contracts to Australian growers and processors. “I’d love to see [tenders] advertised on the web so they could be promoted to farmers.”

Up to standard?

Dr Mark Zirnsak is the director at the justice and international mission unit of the Uniting Church of Australia. In his capacity as a social justice advocate, he investigates complaints about food processing plants overseas.

Woolworths and Coles both have an audit system in place to ensure overseas manufacturers maintain workplace standards in line with the UN’s International Covenant of Economic, Social and Cultural Rights, which calls for just and favourable working conditions. However, Zirnsak argues announced visits and lack of information about sourcing locations indicate a lack of transparency.

“It’s great when a supermarket chain has a strong code, but it needs to be backed by proper auditing, which would include unannounced inspections and talking to workers without management being present, which is currently not the case with many companies,” he says.

* Names changed

04.CHOICE on country of origin labelling


Of products made in Australia, it’s not always easy to determine exactly where the ingredients came from. A large proportion of the products we surveyed that were made in Australia included ingredients of unidentified origin.

Of our sample of 100 market leader products, 42% specified they were packaged locally with some or all ingredients from overseas. Of the Coles products, 63% were labelled as packaged in Australia from a combination of local and/or imported ingredients, while 71% of Woolies products were labelled as packed locally but including ingredients of overseas origin.

So what does the term “made in Australia” even mean? Right now, in order to use these words, the product must have undergone substantial transformation and 50% of processing costs here. Labels such as “packed in Australia from an imported ingredient” don’t really explain much at all, except that an ingredient from a mystery country was repackaged in an Australian factory.

“‘Made in Australia from imported and local ingredients’ doesn’t quite give you the whole story,” says Churchill. CHOICE agrees this grey area needs tightening.

In July, Australian Greens leader Christine Milne announced the Accurate Country of Origin Labelling for Food Bill in an attempt to protect both Australian consumers and farmers from this type of misleading labelling. Milne argues the bill provides clear food-specific country-of-origin labelling to allow customers to better understand where the produce they buy comes from and ensure a fair and transparent market for local growers.

What CHOICE wants

CHOICE knows that country of origin (CoO) labelling is one of the biggest consumer frustrations when it comes to food labelling. We’ve long called on governments around the country to clear up with confusion caused by the multitude of different terms currently used on packaging.

In our July 2011 members’survey, close to 90% of more than 300 respondents said it was important to know the origin of the food they eat, with two-thirds rating it as very important.

Do you look for country of origin labellng on any foods in particular? Do you find it difficult to make informed purchases? And which terms are most confusing or unhelpful – “made in Australia from local and imported ingredients” or “packaged in Australia”? We‘d like to hear your thoughts – please email us at investigation@choice.com.au.

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