Farming unions meet to discuss unfair trading practices in dairy industry

Looking at short, medium and long-term issues facing dairy farmers across the UK, debate also covered forage availability, antibiotics, industry reputation, Brexit and trade.

But the main discussion revolved around Defra and the devolved governments’ plans to regulate on milk contracts.

All four unions welcomed the fact that the government has listened to their call, in the Grocery Code Adjudicator (GCA) consultation, for a fairer, more balanced supply chain.

In Defra’s own words: “The Government is committed to a fair, transparent and thriving modern groceries supply chain”.

The department recognises that there are “still some concerns about unfair trading practices in the supply chain, in particular, amongst primary producers.”

The unions say the three specific concerns are the balance of bargaining power, unfair or unclear contract terms and a lack of trust and transparency that discourages good relationships across the supply chain.

All concerns were raised in the respective responses to the GCA consultation last year. The farming unions also welcome Defra’s recognition of the need for fairer, more balanced contracts between farmers and first purchasers.

‘Huge opportunity’

Speaking after the meeting NFU Scotland’s Milk Committee chairman John Smith, a dairy farmer from Kintyre, said the unions have argued for “fairer, more effective and equitable milk contracts for many years” and is a “huge opportunity for the entire UK dairy sector”.

“That said, the blunt wording of the current EU regulation on milk contracts isn’t suitable for our diverse UK dairy industry – this is one of the reasons the UK opted for the voluntary code of conduct for contracts when the EU regulation first came into force,” Mr Smith said.

“Rather than rush through a text developed for the whole EU dairy sector, we would rather work with Government on improving this text to achieve better results for UK dairy farmers and dairy processors. This needs to go hand in hand with better farmer representation and better market data.

“These are three corners of a triangle that will help ensure more fairness in the supply chain – the ultimate goal of Government and the farming unions. Regulating on one of these areas isn’t sufficient.

Mr Smith added: “This will be the thrust of our response to Government in its upcoming consultation on compulsory milk contracts.”


Source: FarmingUK


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