Some farmers have nearly gone bankrupt because of fertiliser being withheld by suppliers ahead of price rises, a Senate committee has heard.
Former South Australian premier Dean Brown said the farmers in his state had been unable to sow crops after fertiliser supply contracts were breached.
The delays had also led to farmers paying higher prices for the product, said Mr Brown, now a special drought adviser to the SA government.
He gave the committee five letters showing farmers were refused access to fertiliser supplies ahead of price rises.
Some South Australian farmers nearly went bankrupt last year because of supply delays of about eight weeks.
"As a result, many of the farmers couldn't put their crops in until early June, because the fertiliser hadn't been provided," Mr Brown told the committee.
"Those who were able to put crops in in late April, and early May, when the opening rains came, in fact did have a harvest."
"Those who were delayed due to this fertiliser company didn't have a harvest and so the fertiliser company cost (them) very dearly indeed."
The farmers were often told prices were about to go up, which constituted a restraint of trade on supplies, he said.
"If you've got the product there, and you've advertised it for sale, and a farmer comes along to buy it and you refused to supply it, I think that's a restraint of trade," he told the senators.
Mr Brown said breaches of contract were common.
"The company ... having agreed to a price, then pulled back from supplying it and eventually the farmer had to buy it at a higher price."
The committee also heard that banks were worried about the price hikes because of farmers' abilities to pay off debts and restricted their financing.
He said there was case for federal parliament to review the Trade Practices Act in regard to fertiliser pricing.
"I think what the farmers want, is to know that they can get a price for fertiliser when they want it, not have to wait, and wait month after month knowing that the fertiliser is there, but the companies just aren't willing to sell it."
A representative of agents retailing fertiliser said they are frustrated and embarrassed about the situation.
"Our members find themselves as the meat in the sandwich," Australian Services Association national president Rod Abbott told the committee.
"They're caught between the farmer-customer if you like, and the wholesale supplier, manufacturer or importer.
"And we've found ourselves in a situation with very little information."
Mr Abbott said Incitec Pivot - the only major manufacturer of fertiliser in Australia - had a virtual monopoly in the industry.
"They effectively control the market, they manufacture a very significant quantity of fertiliser in Australia.
"They sell a portion of that manufacture, to the other wholesale competitors or the wholesale providers ... and so the market is very, very aligned if you like, to one manufacturing source."
