Fruit and vegetable growers have told the competition watchdog they are reluctant to report complaints against the major supermarkets and wholesalers because they fear retribution.
The Australian Competition and Consumer Commission (ACCC) says its meetings with fruit, veg and wine grape growers across the country has identified several concerns, the fear of retribution being a key and widespread one.
Its report Perspectives in horticulture and viticulture, released on Thursday, says most growers are reluctant to report issues.
"Growers have spoken of threats of being blacklisted or placed on a 'trading holiday'," it says.
"In Bundaberg, a number of growers said they had been put on a trading holiday by a wholesaler in retaliation for raising a complaint."
The report said some growers even described the viticulture (wine) industry as a "retribution state,' with grower complaints meeting with harsh consequences from winemakers.
And a NSW citrus grower told the ACCC he would not dare raise a complaint against a major retailer.
One grower called for a review into whistle-blowing protections so growers could raise issues without fear of retribution.
"The fear of raising complaints has also been a barrier to the ACCC's engagement work," the report said.
"For example, a number of large growers in Western Australia indicated they would have liked to attend the Bunbury workshop, but did not due to concerns about being seen to be speaking with the ACCC."
The ACCC said its investigation into the $9.47 billion horticulture and viticulture industries has found the Horticulture Code, a mandatory industry code, needs an overhaul.
"It is clear that the Horticulture Code is not achieving its aims and we believe that significant changes to the code are required," ACCC deputy chair Michael Schaper said.
He said penalties and infringement notices were needed for code breaches to encourage compliance.
The ACCC said it will also examine growers' allegations of late payments from wholesalers and retailers.
