Call for tougher grocery sector regulation

Most Australians believe grocery giants Coles and Woolworths have too much market power, a survey says.

It found 72 per cent of one thousand respondents thought the grocery market was too dominated by the pair, which control up to 80 per cent of the sector - despite their reputation for offering low prices.

This compared to the 22 per cent who thought there was healthy market competition.

The Master Grocers Australia and Liquor Retailers Australia study came ahead of the release of the federal government's wide ranging competition review on Monday.

The MGA has called for tougher competition laws and regulatory support for smaller independent supermarkets, as well as increased legal resources for the Australian Competition and Consumer Commission.

"Many consider the ACCC to be `toothless' at the moment," according to the survey.

Master Grocers Australia CEO Jos de Bruin said the ACCC must be able to stop Coles and Woolworths from misusing their market power or engaging in anti-competitive behaviours.

"It is one minute to midnight for competition in the grocery sector and we will be working with the federal government to convince them that action needs to be taken now," he said.