Government promises crackdown on unfair contracts in dairy sector

The UK is working alongside Wales, Scotland and Northern Ireland to set up a code of conduct for the dairy sector to “crack down” on unfair contracts.

The new statutory regulations aim to improve contract standards and tackle imbalances of power between dairy farmers and milk buyers, in response to a government consultation on the dairy supply chain held last year.

The new code will establish a framework of “minimum standards” to prevent unfair treatment of dairy farmers, including short notice changes to contract terms, increase transparency and enable more flexibility towards supplier’s circumstances. 

Victoria Prentis, farming minister at the Department For Environment Food and Rural Affairs, said: “It is only right that any contracts drawn up between farmers and processors deliver fair conditions across the board.

“This new code of conduct will crack down on unfair practices within the supply chain, supporting the dairy sector and ensuring that our dairy farmers remain competitive as they look to the future.”

Lesley Griffiths, the minister for Environment, Energy and Rural Affairs at the Welsh Government, said: "Those within the sector have reported many contracts do not adhere to the voluntary code of best practice on contractual relationships, and the resulting imbalance of power leads to reduced profitability for our hard-working dairy farmers, and unsustainable distribution of profits along supply chains."

Fergus Ewing, secretary of the Scottish Rural Economy, added that Scottish respondents were strong supporters of “putting transparency into contracts to protect farmers”. 

“It is very important that we listen to the views of both our hard-working dairy farmers and processors here in Scotland,” he added.

Meanwhile, industry organisations in the beef supply chain have collaborated to launch a DNA traceability system to allow beef in all UK products, across retail, food services and manufacturing, to be traced back to the original farm and animal.

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