Unions urge dairy farmers to speak up for 'fairer' supply chain

The UK's main farming unions have urged dairy farmers to speak up for fair contract terms
The UK's main farming unions have urged dairy farmers to speak up for fair contract terms

Dairy farmers have been encouraged to engage with a Government consultation on dairy contracts to speak up for a more effective supply chain, with fairer terms.

The industry says that dairy farmers have shouldered too much of the risk in the market and in many cases have been subject to unfair contract terms and trading practices.

The four UK farming unions, NFU, NFU Cymru, NFU Scotland and Ulster Farmers' Union, have now urged farmers to speak up for fair contract terms in a forthcoming consultation.

The organisations have reiterated their support for regulated contract terms for farmers and will be consulting with their members when the consultation is issued, in an effort to re-balance where the risk currently sits within the dairy supply chain.

In a joint statement, the dairy farmer representatives of the four UK farming unions said: “As outlined in the Grocery Code Adjudicator (GCA) review published in February, there is clearly an imbalance of power within the dairy supply chain.

“As we await the Government’s consultation on dairy contracts to be issued, in order for us to understand the proposals in full, we are using this time to consult with our members extensively.

“We want to understand their views on dairy contracts and our final responses to that consultation will reflect our members’ views. We are all keen to constructively engage with industry and Government to deliver the improvements we all want to see.”

'Flexible and innovative'

The four unions said they want to see a “flexible and innovative” regulation that delivers “fair terms” for farmers and an equitable balancing of risk between farmers and buyers.

The statement added: “We have been exploring a range of legal mechanisms to achieve this, including looking at Common Market Organisation (CMO) legislation as well as other legal powers that the government might use to achieve effective regulation.

“As we leave the EU, the UK dairy market needs to be fit for purpose; commercially focused, innovative and competitive. It is vital that we have a properly operating dairy market where risk is shared across the supply chain.

“Dairy farmers need to be in a strong position to develop professional and sustainable relationships with their buyers, while operating to fair trading terms,” the statement said.

The Government response to the consultation into the remit of the GCA, published in February 2018, included the proposed measure of “introducing compulsory milk contracts between producers and purchasers to help protect dairy farmers by setting out clear terms, including the price for the delivery of milk, the timing of deliveries, the duration of the contract, details of payment procedures, and arrangements for collecting and delivering raw milk”.

The situation regarding milk contracts in Northern Ireland is not the same as in England, Wales and Scotland and the UFU are currently undertaking internal discussion with the relevant authorities.

However, the UFU are in broad agreement with the sentiments of its counterparts in Britain.