Critics hoping for sweeping changes to the supermarket sector to bring down the cost of groceries are unimpressed with the Commerce Commission's final recommendations.

Its final report into the $22 billion industry out today said Foodstuffs and Woolworths have been making profits at the expense of consumers, small food retailers and manufacturers.

The commission's report highlighted that New Zealand's retail grocery prices appeared comparatively high by international standards and the profitability of major retailers also appeared high.

The government is not ruling out forcing supermarket chains to sell stores if the recommended changes fail to reduce prices for consumers.

The Commerce Commission's preliminary report floated some big ideas - forcing the big two supermarkets to sell some stores, and even possibly government intervention to get a third operator into the market.

But its final recommendations out today are much tamer - making more land available for new stores and improving access to wholesale supply for third party retailers.

Changes may not reduce prices - Food and Grocery Council

Meanwhile, Food and Grocery Council chief executive Katherine Rich said the changes tipped the balance back towards suppliers.

"Certainly over the last 20 years we've just seen a shift of risk and cost onto suppliers and profits to the retailers and bad behaviour with that as well."

Ideally, there would be four or five major players in the sector rather than the duopoly, Rich said.

Until there was genuine competition there might not be much movement on prices for consumers, she said.

And the government is not ruling out forcing supermarket chains to sell stores if the Commerce Commission's recommended changes fail to reduce prices for consumers.

Commerce and Consumer Affairs Minister David Clark said he unequivocally accepted the findings, but would go further if needed.

He told Checkpoint that as a result of government pressure, the supermarkets had promised to make their pricing more transparent, end land banking and look at introducing a code of conduct.

"Those things weren't happening before, the supermarkets have accepted them ...and that will mean that people get fairer prices and a more competitive sector."

He expected that if the supermarkets acted immediately on recommendations such as making loyalty programmes and promotions easier to understand, it would lead to cheaper prices.

Asked why the government did not force the main two players to sell some of their assets so that a third retailer could be set up, he said it was not something that could be achieved overnight.

A new big player would need to have access to the wholesale suppliers who were working with Woolworths and Foodstuffs at present. Clark has asked for a new regime to be set up so that this could happen.

Clark denied that the final report meant that Labour had broken a pre-election promise to break the supermarket duopoly and fairer food prices.

"There is a very big sea change in the way those supermarkets are behaving."

He expected to have a new law introducing changes before Parliament this year.

"This stuff is too important not to get right for consumers."

The supermarkets respond

Woolworths said it was good to have clarity about the path ahead.

Managing director Spencer Sonn said it supported the recommendations.

"Like the government, we want New Zealanders to be confident that our supermarkets are good places to shop, and that as a business we are good to work with.

"As we've heard through the market study process, we know that some changes are not only required, but expected of us."

Foodstuffs North Island chief executive Chris Quin said competition could work better for consumers.

"As a result, we accept that the sector does need to change and we are committed to our role in doing that.

"Work to implement the recommendations in the final report is a priority for us and has already started.

"We've been clear throughout this process that [Foodstuff's] strategy is to become one of the most customer driven retailers in the world. This process has shown that we need to do more and we will continue to focus on improving value for customers, investing in innovation and delivering on our customer promises."