Members of European Parliament are calling for more action against unfair trading practices in the food supply chain.

In a plenary session on June 7, MEPs urged the European Commission to ensure fair earnings for farmers and voted on a resolution to ensure fair and transparent trade relations among food producers, suppliers and distributors.

In turn, these fair trading practices will prevent issues such as overproduction and food waste, while providing better support for small to medium-sized farm businesses which are often the most vulnerable, according to MEPs.

“"The initiatives taken so far have not been effective. That’'s why we give more suggestions. More work should be done to improve relations between suppliers and supermarkets and hypermarkets, especially when it comes to minimizing the so-called ‘fear factor’,”" says Parliament’'s rapporteur Edward Czesak.

"“We also call on the European Commission to do more when it comes to new tools that should help us to counteract unfair trading practices. 

"“All players in the food supply chain should enjoy the same rights.”"

The resolution says income and power imbalance in the food supply chain must be urgently tackled in order to improve the ‘bargaining power’ of farmers.

It was approved by 600 votes to 48, with 24 abstentions and MEPs stressed that selling production costs, and larger-scale retailers ‘'misusing'’ fruit and vegetables as ‘'loss leaders'’ threatens the sustainability of European production.

Overcoming the fear factor

During the sessions, MEPs also discussed how previous voluntary and self-regulated schemes have shown ‘limited results’, mainly because of the lack of enforcement, conflicts of interest between parties, farmers being under-represented and dispute settlement mechanisms that do not reflect the supplier ‘fear factor’.

MEPs believe framework legislation at the EU level is necessary to tackle unfair trading practices.

Ahead of the vote, the British National Farmers Union (NFU) lobbied MEPs, and president Meurig Raymond is pleased with the call for stronger action and legislation.

"“This report is promising, but we will continue to reiterate that without an effective EU legislative framework to oversee unfair trading practices, the ‘fear factor’ will remain in commercial relationships,"” he says.

“"With Groceries Supply Code of Practice (GSCOP) working well in the U.K. we believe an extension of this at an EU level, as the report recommends, would be a very good thing.”"

Also reacting to the announcement, Copa Cogeca general secretary Pekka Pesonen said it was 'unacceptable that European farmers are being 'squeezed further and further by the processors and retailers'.

"The price the farmers gets often does not even cover his production costs. Below cost selling must stop," he says.

"We also welcome recognition by MEPs that strengthening and establishing producer organizations must go hand in hand with strengthening farmers' bargaining power in the food chain.

"In this respect, we believe that prices paid to farmers must better reflect the added value generated by farmers and their agri-cooperatives and that they receive a better share of the consumer euro."

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