Senator warns of SPC closure flow-on

The end of the line of SPC Ardmona would have flow-on effects for fruit growers in other states, independent senator Nick Xenophon says.

The fruit processor has argued, in its bid for a $50 million co-investment package from the federal and Victorian governments, that the dumping of cheap imports onto the Australian market is putting thousands of Australian jobs at risk.

Federal cabinet is meeting in Canberra on Thursday to consider whether to support the package or provide other assistance.

The company says it needs some "real encouragement" from the government to ensure it continues operating.

Senator Xenophon said the government should be using anti-dumping duties to create a level playing field for companies such as SPC Ardmona.

"The government needs to understand that free trade shouldn't be 'free for all' trade," Senator Xenophon said.

The Productivity Commission has rejected the use of further tariffs on imported fruit.

Senator Xenophon said that if SPC Ardmona closes there would be an influx of imported canned produce which would have an impact on the processed fruit sector across the country.

Victorian growers would also find themselves without a market, leading to a glut in supply and a drop in prices across the entire Murray Darling basin.