EU Commission set to tackle unfair trading in food sector

Greater transparency in the food supply chain is on the cards after the European Commission published a long-awaited impact assessment report on unfair trading practices in the sector.

The assessment flags the possibility of introducing EU-wide legislation for the agri-food supply chain and suggests increased price transparency is required.

Such a move could see more clarity introduced in sectors such as the beef and lamb industries, where farmers want a more open breakdown of what share processors and retailers receive from the final retail price.

The Commission is opening a public consultation on the assessment and will then decide if new legislation is needed to tackle alleged unfair trading practices.

Last June a sizeable majority of MEPs voted for EU regulation on unfair trading practices. However, member states have been divided on whether or not they want binding EU legislation.

The report says the food supply chain is "particularly prone to trading practices that deviate from fair commercial conduct".

Small operators in the chain, including farmers, usually have little bargaining power and are more likely to be victims of unfair practices, it asserts.

The Commission has identified four possible policy options:

* To retain the status quo;

* To introduce EU-wide non-legislative guidelines and recommendations;

* EU legislation to protect weaker operators in the food supply chain, including farmers;

* Minimum framework legislation for the whole food supply chain.

The Commission also says that "the level of market transparency along the supply chain is uneven".

The report suggests that data on prices at which processors sell certain key products or product groups could increasingly be standardised, collected and disclosed.

Incomes

This would "shed light on relevant market information" downstream of the primary producer.

EU Agriculture Commissioner Phil Hogan has previously said that he will present a communication on unfair trading practices in the agri-food supply chain, which may or may not include legislative proposals, during the first half of 2018.

Commenting on the EU report, ICMSA president John Comer said fairness in the food chain was critical to ensuring viable incomes for farm families.

"It is absolutely essential that the measures implemented by the EU identifies the market failures along the food supply chain and ensures that farmers receive their fair share of the final consumer price," Mr Comer said.