The coalition is trying to legislate similar measures in the energy sector, with the Federal Court to be empowered to issue orders to break up wholesale firms in the worst cases of misconduct.
Rookie senator Susan McDonald believes the Australian Competition and Consumer Commission could be given a “big stick” to act in dairy.
“I think we need to look at the impact of the market power of retailers in order to prevent unfair bargaining practices in the agrifood supply chain,” she told parliament.
“Across the board, unequal bargaining power, right through from the retailer to the processor and the farmers, is indirectly affecting farmgate prices.”
Coles and Woolworths have come under fire for the low cost of milk, with farmers arguing cheap retail prices are causing them pain through the supply chain.
Senator McDonald said dairy farmers were leaving the industry in droves because it was impossible to make a decent living with the big supermarkets’ milk prices.
“I think it is time we give the ACCC the right powers to deal with repetitive and unfair bargaining practices by retailers,” Senator McDonald said.
Pauline Hanson has called for the industry to be re-regulated and is expected to introduce a private senator’s bill about dairy on Wednesday.
“The processors and retailers are just being cold hearted and cruel, putting their profits way ahead of the needs of a traditional Australian industry and the lives and livelihoods of hardworking Australians,” she said.
Peak lobby groups Australian Dairy Farmers and National Farmers Federation have rejected calls for re-regulation.
Senator Hanson and her One Nation colleague Malcolm Roberts have vowed to abstain from voting on “non-critical” bills until the government acts to save the dairy industry.
The One Nation leader is demanding the coalition implement a dairy mandatory code of conduct, which the ACCC developed more than 18 months ago.