Australian supermarket giant Coles offers the cheapest basket of groceries on a new price comparison website launched by the country's government.

The website www.grocerychoice.gov.au, allows consumers to compare grocery prices in their local area within the country.

While Coles are cheapest on a basket of selected groceries in 52 out of 61 regions, German discount retailer Aldi came out cheapest on basic staple products as a result of it offering a smaller product range.

The new services comes a day after the Australian Competition and Consumer Commission's (ACCC) report of its six-month enquiry into grocery prices was released calling for more competition in the grocery sector.

The Commission said that while the market was "workably competitive" steps should be taken to encourage more aggressive competition between supermarkets.

It said that Australian consumers would "significantly benefit" if Coles and Woolworths faced more competitive threats that encouraged more "aggressive pricing strategies".

The Commission mentioned a number of recommended legislative changes, including the introduction of unit pricing, changes at a federal level to the Horticulture Act and the website.

ACCC chairman Graeme Samuel said it would be different from similar sites sponsored by supermarkets.

"It won't publish the weekly specials, it won't list grocery prices for individual supermarkets….This is about giving consumers something new that the supermarket chains won't tell them - who is cheapest in each region overall," he said.

Each month, GroceryChoice publishes the price of typical grocery baskets for a range of supermarket retailers located in 61 different metropolitan, regional and rural regions across Australia including Woolworths/Safeway; Coles/BI-LO, Aldi, and other supermarket retailers, for example IGA and Franklins.

Prices are sourced from an independent monthly survey of around 500 products from 600 supermarkets across Australia. The results will then be updated on the first business day of each month.