I understand tougher competition to mean competition that wins more than competition that does not.
What's your understanding?
Djokovic and Murray are not even able to consistently avoid bad losses in slams, in addition to their failure thus far to win more than 1 slam between them. So they are obviously not any better than the 1 or 2 slam winning challengers behind the true rivals Graf faced like Sabatini, Pierce, Novotna, even Martinez. The fact Federer struggles so much more with them than Graf did with those I mentioned is his own fault.
The bit in bold reinforces my point. Federer had and has players who can compete and win against him more than can be said about Graf so Federer has tougher competition.
No Graf is a better player amongst her gender, the undisputed female GOAT which Federer is not even close to being among the men. Hence why she never allowed anyone ever to dominate her head to head, even Seles during her own peak and dominance of the womens game was unable to, and Navratilova still at the peak of her reign vs a 16 and 17 year old Graf was unable to. Federer being not as great as Graf is unable to prevent the occasional rival from having the upper hand or even temporarily dominating him (eg- Nadal, Murray in non slam events) or from having more wins against him (Djokovic, Nalbandian, etc..).
Graf has too much pride to allow herself while still in her prime to go 3-6 vs a slamless at age 22 player like Murray, go 5-5 in the last almost 3 years vs a 1 slam winning 22 year old like Djokovic, to only be up 10-8 vs a slamess pretender like Nalbandian. And certainly too much pride to lose a slam final 6-1, 6-3, 6-0 to her biggest rival (Graf would never allow Seles or Navratilova or a Williams to beat her in a slam by that score even at 15 or 35 years old) or to let her biggest rival regularly push her to the limit or beat her on her turf (eg- Seles beating Graf at Wimbledon or Navratilova beating prime Graf at the French).
Federer is not the female Graf. One is GOAT, the other is not and only has hype by some of being it since he is most recent. One scares all her main rivals while herself being scared of none of them, one other is actually scared of some of his closest rivals all with many fewer slams and accolades than he has.