Western Victorian prime lamb producer staunch defender of supermarket giant

Ararat prime lamb producer Charlie de Fegely told the Senate Select Committee on Supermarket Prices, there were "other processors" who had endeavoured to keep prices down.

"It would be an absolute disaster if the outcome of this inquiry was to have government intervention in price setting," Mr de Fegely said in his submission to the inquiry.

"Woolworths is our main customer and we have, over the past two years, developed a favourable relationship.

"The prices we have received in the past two years would be the best that we could achieve in the industry, if not better. "

He said the family generally sold 10,000 lambs through Woolworth's Greenstock arm, from November until the end of March.

"We can average out with our price, whereas if someone has only one or two loads - and cops a dud market - you would think there is justification for them to think they have been gouged," he said.

"I think there are greater culprits in gouging in the red meat world, and I won't say who they are, but they have done everything they can to push the market down."

He said prices could be up to $10 a head better, when dealing with Woolworths.

"But we have to do more than the average person, who just throws lambs into the Ballarat market," he said

"We have to get our weight specifications and carcases right, so we are being rewarded for doing the job properly."

By continuing to work with Woolworths, Mr de Fegely said the family aimed to continually improve its lambs and management so they met ever-increasing consumer demands.

"We would be denied market access, if we didn't do it," he said.

Mr Fegely said rising costs, influenced by government and other factors, were a bigger issue than the prices offered by the supermarket.

That was particularly true of labour, insurance and energy prices, he said.

"While prices have increased, the greatest factors that could enhance our business are better roads and communications," he said.

"Our freight costs have increased due to damage to trucks, freighting lambs to slaughter, from the poor state of our roads."

Poor internet communication was restricting the uptake of new technologies, such as factual recognition and pedigree management.

He described his working relationship with Woolworths as "great" and said it would be tragic to have any government intervention in controlling prices.

"I see our relationship with Greenstock and Woolworths as the key to our future," he said.

Other producers could follow suit, he said.

"The more people who do it makes it harder for those who don't," he said.

New South Wales central west feedlot operator Gundamain Pastoral, Eugowra, also told they where "more than happy" with their dealings with Woolworths.

Tess and Andrew Herbert told the inquiry they would resist any extra impost on the business in the form of a framework to "protect" them from a solid and reliable business relationship that had worked successfully for many years.

"It would be another level of bureaucracy and an increased red tape burden on our operations," the Herberts said.