Q: After supermarket costs and profit; after warehousing, depreciation, general administration, interest, research and development, taxes, corporate overheads and profit; after sales and marketing; after advertising; after packaging; after freight; after labour; after ultra-processing; after the miller or grain operator has done their bit; after all of that—what percentage of the retail price of cereal does the farmer get?
- FlavourCrusader, Australia
A: Hi Flavour Crusader, thanks for a great question!
To clarify right off the bat, Kellogg’s doesn’t pay or employ farmers directly. Instead, we have contracts with suppliers that manage these relationships and purchase the grains direct from the farmers at a price based on the current market. This price differs based on the amount of grain that we require, the type of grain we’re sourcing and the overall Australian economy. The specific amounts fluctuate, but you can find out what the current grain prices are on the ASX website.