Relationships between supermarkets and supplier have improved, but farmers say they are still subject to unfair trading practices ©123RF
Relationships between supermarkets and supplier have improved, but farmers say they are still subject to unfair trading practices ©123RF

Farmers seek stronger protection through GCA

12 January 2017

Agricultural groups have called for the Grocery Code Adjudicator’s (GCA) powers to be expanded.

Voluntary practices covering the agricultural sector should be made compulsory, said NFU England.

The voluntary codes, such as the Dairy Industry Code of Best Practice, outline the contractual rights around pricing, payments and order volumes that farmers should seek to achieve in negotiations, but are not enforceable on purchasers.

In its submission to the ongoing review of GCA, which was set up in 2013, NFU England also called for the turnover bracket for the Groceries Supply Code of Practice, which is enforceable, to be reduced so it covers more retailers. 

“The GCA plays an important role within the grocery sector and undoubtedly Mrs [Christine] Tacon [the adjudicator] has had a positive impact since she took office in June 2013,” said Meurig Raymond, NFU England president.

It is important, however, that the position of adjudicator remains independent as changes to the sector could leave farmers less able to stand up to supermarkets, he added.

“The increasing consolidation of suppliers and processors within the supply chain, in turn reducing competition and increasing buying power, leads to a power imbalance within the supply chain,” he said.

These views were echoed by NFU Scotland, which said “good progress” had been made in the relationship between supermarkets and supplier since the GCA was created, but that farmers were still subjected to unfair trading practices including delayed payments and short notice changes to supply agreements.

“The GCA currently only regulates the 10 largest supermarkets, and members are keen to see its remit extended to a far wider number of retailers,” said John Armour, food and supply chain manager at NFU Scotland.

Dairy UK, a trade association representing the dairy sector, also publicised its submission to the GCA review. It said the adjudicator’s remit should be extended to cover smaller retailers and the food services sector, but that it “firmly believes” GCA should not cover the relationship between dairy farmers and milk purchasers. 

The Department for Business, Energy and Industrial Strategy is currently undertaking a statutory review of GCA, to evaluate its first three years. It is currently reviewing submissions made, and is no longer accepting new submissions.

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