The peak industry body for Australian onion farmers is investigating reports some growers are supplying imported onions to supermarkets, claiming they grew them locally.

Onions Australia said it had received information about farmers buying imported onions, re-packaging them and selling them to Coles and Woolworths.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 5 minutes 28 seconds 5 m Onions Australia chair Kees Versteeg describes reports of farmers repackaging imported onions and supplying them to supermarkets, claiming they grew them locally. Coles manager Brad Gorman says there is no plan to investigate suppliers. ( Danielle Grindlay ) Download 10 MB

In 2012 the two major supermarkets made commitments to only stock Australian onions, which meant growers had to ensure year-round supply.

Historically the industry has struggled to meet demand, but Onions Australia chair Kees Versteeg said growers were now on top of it and any fraudulent activity was an opportunistic way of making extra money.

Mr Versteeg said it was almost impossible to prove growers, or other players in the onion supply chain, were cheating consumers.

"I think it's about making the industry and Australia aware that the potential is there these things can happen," he said.

"The fact is, you can get away with it because no one is policing it. I even find it difficult to prove."

The reports of alleged farmer fraud follow revelations some retailers also have been selling imported onions with false 'Australian grown' signage.

Passing imported onions off as local 'very easy'

Onion industry representatives have repeated Mr Verteeg's concerns to ABC Rural, including another grower who said he knew of two peers mixing imported onions with their own produce.

Mr Versteeg, who runs an onion farm and packing company, said the practice would be "very easy".

"There's no one dropping into our packing facility and investigating those things," he said.

"And that's the problem — onions that are not being traced back to some certain extent as to where they come from, they could be coming from anywhere ... they could be from China."

So who is responsible for ensuring consumers are getting what they pay for, when a sign says 'Australian grown'?

Mr Versteeg said it was "a tough question" but placed responsibility on retailers.

"I've got to be 100 per cent sure as a retailer, being a major retailer or an independent retailer, that the product indeed is coming from the country I put on the shelf," he said.

"It's one thing to say, in the media and out there, 'Our products are grown in Australia and are coming from Australian growers'.

"How can you back that up?"

Coles trusts growers, has no plans to investigate reports

Coles was the first supermarket to announce it would only stock Australian onions on its shelves.

Fresh produce manager Brad Gorman said the commitment was of "significant value" to the onion industry.

"I would hate to put a dollar figure on it but we sell more than 30,000 tonnes of brown, white, red and pink onions across the country all year," he said.

"It gives our growers surety of supply. They know that there's a customer there for their product all year round."

Mr Gorman said the decision to stock Australian onions came down to consumer demand.

"Australian customers prefer local product," he said.

"We decided to listen to them, work with our growers, and ensure we were all Australian-grown."

Despite the onion industry's concerns such a promise could not be ensured, and that fraudulent activity was underway, Mr Gorman said Coles had no plans to investigate its suppliers.

"Absolutely not, we have great faith installed in our growers," he said.

"They grow with integrity, they support Australian jobs and there's absolutely no reason for us to investigate them."

Growers are not under too much pressure, Coles says

Mr Gorman said Coles' direct-supply relationships were the "best way" of regulating traceability, but conceded it was a system of trust.

"A lot of the industry's onions are sold through central markets," he said. "When that happens you tend to lose the traceability of it.

"In having the direct-supply relationships that we have with our growers, you absolutely have that trust in place."

Mr Gorman rejected suggestions growers were under too much pressure to meet demand, saying if there was a shortage of onions, that message would be conveyed to consumers.

"We've had challenges in white onion supply for a couple of weeks," he said.

"When that happens we don't go and import them, we just give consumers another offer and work with our growers to get supply back online."