Aussie Businesses Fear New Food Packaging Laws Harm Industry

Small food businesses in Australia have raised concerns that the introduction of new food labeling laws could send them broke, with some saying the mandatory repackaging associated could cost "millions of dollars."

Following an outbreak of hepatitis-A from foreign-sourced berries in 2014, the federal government announced plans to introduce a law requiring food packaging to clearly show the origin of ingredients and the proportion of Australian ingredients, meaning businesses would need to repackage their products.

The laws are due to be enforced next year, but those within the industry have raised concerns that it could cost too much to do so, with some saying it could send businesses broke.

Brookfarm Muesli's Pam Brook told the Australian Broadcasting Corporation (ABC) Thursday that her 70 products would all require repackaging, something she said could cost up to 500,000 Australian dollars (378,000 U.S. dollars).

"The idea is great. I completely agree with the idea that people want to know where their food comes from, but the execution is terrible," Brook said.

She said that it was unfair that small producers are slugged, while mass producers of "junk food" are exempt from the laws, as the government said consumers were not concerned with the origin of the ingredients of junk food.

"The execution isn't transparent to consumers. It places an unfair burden on small and medium manufacturers and it lets importers and producers of junk foods off scot-free," Brook said.

Meanwhile Food South Australia's CEO, Catherine Sayer, said the laws would not only harm industry bottom lines due to once-off repackaging, but sometimes seasonal foods required ingredients sourced from elsewhere, meaning the proportion would differ throughout the year.

She said as a result, some businesses, especially "value"-based food producers, would struggle to make money as they would spend it on complying with the new rules.

"Sometimes there is a lot of butter in Australia and sometimes there is not, so companies have to look overseas to purchase some of their ingredients," Sayer told the ABC.

"That is fine, but the country of origin labeling will not take that into account and you have to lower the average of Australian content overall, which then makes the product look like it is not from Australia."

"It just gets a lot harder for the industry, a lot more expensive, the further up the value chain you go," she added.

Businesses will be required to comply with the new laws by July 1, 2018. Enditem