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No Aldi? Then you’re probably paying more for groceries

A lack of supermarket competition in parts of Australia has led to higher grocery prices for some unlucky residents, consumer research has found.

Jun 20, 2024, updated Jun 20, 2024
An Aldi Supermarket in Melbourne. (AAP Image/Joel Carrett)

An Aldi Supermarket in Melbourne. (AAP Image/Joel Carrett)

Shoppers in Tasmania and the Northern Territory are forking out the most on their weekly grocery bill with a lack of competition being blamed.

Research from consumer group Choice found that out of the major supermarkets, Aldi had the lowest prices for a basket of average goods.

An average basket of 14 common household items from Aldi cost $51.51, on average, compared to $68.58 at Woolworths and $69.33 at Coles.

The report said the lack of Aldi stores in Tasmania and the NT contributed to higher average grocery prices in those jurisdictions.

Shoppers in Tasmania paid $68.90 on average for the basket of goods, while those in the NT paid $68.82.

Customers in the remaining jurisdictions paid, on average, between $62 and $64 for the same items.

Choice chief executive Ashley de Silva said where customers lived determined how much they would pay at the checkout.

“If you live in Tasmania or the Northern Territory, you’re paying significantly more each week for your groceries,” he said.

“However, this is mainly due to the fact that these areas have more limited options for shopping than the rest of the country, with no Aldi in Tassie or the NT.”

The basket of items included bread, flour, milk, beef mince, tinned tomatoes, Weet-Bix, apples, carrots, penne, a block of cheese, frozen peas, butter, sugar and tea.

De Silva said Coles and Woolworths were similar in terms of prices.

“Grocery prices at Coles and Woolworths are very closely matched, with only 75 cents separating the prices of our basket of 14 items without specials,” he said.

The report was the first of quarterly, government-funded reports into supermarket prices that were set up to help address cost-of-living concerns at the checkout.

Aldi hailed the report but Coles questioned the survey’s methods and offered its own basket price.

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“We welcome Choice’s contribution; however, it is unclear whether like-for-like products are being compared,” a Coles spokesperson said.

“Our analysis last week comparing the same basket in NSW shows customers can purchase these products for $59.35 at Coles.”

Woolworths emphasised choice in its response to the survey.

“We know many of our customers pick Woolworths because of our wide range of high quality products at competitive prices in more than 1,000 locations across Australia,” the company said in a statement.

The federal government has provided Choice with $1.1 million to carry out the reports over three years.

A federal review has called for a code of conduct between supermarkets and suppliers to be made mandatory.

Competition Minister Andrew Leigh said the report would help put pressure on supermarket giants to lower their prices.

“Australians are under cost-of-living pressure, and we know that a lot of that pressure is piled on at the cash register,” he said.

Greens senator Nick McKim said the report highlighted the need for more players in the market.

“It beggars belief that there could be just one per cent difference in prices between the duopoly. The choice between Coles and Woolworths is no choice at all,” he said.

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