Take the Cut or Don’t Grow: McCain’s AUD 15 Price Ultimatum Shocks Tasmanian Potato Growers at Planting Time

Tasmania's processing potato growers are entering the 2026 planting season under an ultimatum. McCain has "unexpectedly" ended price talks with the growers committee and is pursuing a AUD 15 (USD 10.43) per tonne price cut, according to TasFarmers, the state's peak farming organisation. The proposed reduction follows a AUD 19.50 (USD 13.56) per tonne cut in 2025, which growers accepted at the time to help sustain the processor.

The timing has inflamed the dispute. "It is now the beginning of October, growers have ground worked up and ready to plant and now they will receive an ultimatum from McCain to either take the cut or don't grow," said Glynn Williams, chair of the growers committee. He laid out the cost squeeze in blunt terms: "The cost of production is skyrocketing, diesel is approaching AUD 3 a litre, fertiliser is twice last season's price, interest rates are about to rise and employment costs are surging as well, yet growers will have a week to decide if they take a cut or don't grow spud at all." Williams called it "unfair and disrespectful" to drag discussions out since February only to issue an ultimatum on the cusp of planting.

McCain's move mirrors a tactic already used by its rival. In August, Simplot ended price negotiations with its own grower committee and sent contracts directly to individual growers — a step TasFarmers chief executive Nathan Calman described as brutal. "Simplot were quite brutal in the way they put their ultimatum to their growers and we thought that McCain would be different," Calman said, calling McCain's withdrawal from talks "short sighted and not in the best long term interests of McCain, nor Tasmania." Simplot, for its part, has rejected any suggestion it acted inappropriately or pressured growers. Tasmania's Primary Industries Minister Gavin Pearce told parliament at the time that the opening price was a commercial matter between processors and their contracted growers.

McCain disputes the characterisation of a walk-out. "We are continuing conversations with growers," a company spokesperson said when asked about TasFarmers' statement, adding that price negotiations are commercially sensitive and not publicly disclosed. The company, which works with more than 100 potato growers across Australia, said it expected to reach agreements before the start of the planting season — a deadline that, by TasFarmers' account, is effectively already upon both sides.

The standoff highlights a structural tension in Australia's fry industry: a concentrated processing sector facing retail and export price pressure on one side, and a small pool of contract growers absorbing two consecutive years of price cuts while their diesel, fertiliser, finance and labour costs climb on the other. With the 2025 cut justified as a one-off to keep the processor viable, growers are now asking where the floor is — and whether collective negotiation still exists in practice when contracts can be sent to farms individually. How many Tasmanian hectares get planted in the coming weeks will provide the first answer.

Source: Pulse via PotatoPro, 04.10.2026