Govt sowing the seeds of fairer prices for farmers

Major supermarkets need to be held more accountable for their actions, the federal agriculture minister has declared, expressing confidence suppliers will soon secure better deals with grocery chains.

After the heads of Woolworths and Coles were grilled in fiery parliamentary hearings, Murray Watt said progress was being made on farmers receiving a fair price for their produce.

The inquiry was set up over concerns supermarkets were price gouging at the checkout while also offering below market value prices  to suppliers.

Senator Watt said the inquiry was leading to steps in the right direction for farmers being better compensated.

"It's entirely appropriate that the supermarkets are accountable for their actions, whether it be through a Senate inquiry, a new mandatory code of conduct or anything else," he told Sky News on Sunday.

"In the end, what we're seeking here is simply a fair deal for farmers and for families, and I think any honest observer would say that that hasn't been happening.

"It's great that we're finally seeing some action here."

The inquiry comes after a review into the food and grocery code of conduct, which manages dealings between supermarkets and producers, recommended it be made mandatory.

Previously, the code was only a voluntary regime, with the review also recommending harsher penalties apply for supermarkets that breach the code.

Senator Watt said farmers had also been forced to meet appearance standards for fruit and vegetables that were too high, placing additional pressure on them.

"Everyone understands that poor quality fruit and veggies, no one would expect supermarkets to take them, pay for them and put them on shelves," he said.

"But I think what we've been seeing is a much too onerous regime for farmers, that it's simply impossible to meet."

The federal government has also announced it will hold an agricultural summit in May on how the sector can reduce emissions while ensuring its long-term future.

More than 150 farmers, agricultural peak bodies and environmental groups will meet in the Darling Downs region in Queensland as part of the summit.

"We will not be setting an emissions reduction target for our agricultural sector, but the sector will need to contribute to achieving our economy-wide emissions reduction targets," Senator Watt said.

"This is an opportunity for the sector to continue its journey towards more sustainable production, while reducing its costs and lifting its profitability."