McCain Foods has ended negotiations with the TasFarmers Growers Committee and is seeking a $15 per tonne reduction in the price paid for Tasmanian processing potatoes. The move follows a $19.50 per tonne reduction agreed with growers in 2025 to help sustain the processor. Growers chairman Glynn Williams says negotiations had continued since February, with growers expecting an agreement before the new planting season.

Williams says growers now face an ultimatum to accept the reduction or not grow potatoes. He points to rising production costs, including diesel approaching $3 per litre, fertiliser at twice last season’s price, interest rates about to rise and increasing employment costs.

TasFarmers CEO Nathan Calman says the situation follows a similar approach by Simplot, which he says also presented growers with an ultimatum. He says potato-growing margins have fallen massively in recent years and that many growers are in a marginal position.

Calman is calling on McCain to return to negotiations and find an arrangement that supports the processing industry while allowing growers to maintain a sustainable margin.

Williams says growers have remained open to measures that could reduce costs and preserve margins, but argues that ending negotiations immediately before planting puts additional pressure on Tasmanian farmers.

The developments come as growers prepare their fields for planting, with Williams describing McCain’s decision to end negotiations at this point as unfair and disrespectful to growers.