EU asks how to improve the bargaining power of “weak farmers”?

28 Aug 2017 --- A consultation that fights for a fairer food chain has been launched by EU officials looking to find out what improvements need to be made to strengthen the often weak position of small farmers in the food supply chain and curb unfair trading practices that happen when they have limited bargaining power.

The European Commission wants to hear from producers across member states and other stakeholders between now and November 17 and is urging them to share their views as part of the online consultation. 

The move follows indications that the added value in the food supply chain is not adequately distributed across all levels. For instance, this can be down to differences in bargaining power between smaller and therefore more vulnerable operators including farmers and small businesses and their economically stronger and highly concentrated commercial partners.

"Farmers are the first link in the chain and without them, there would not be food to process, sell and consume. However, we notice that they often remain the weakest link,” says Agriculture and Rural Development Commissioner Phil Hogan.

“It is to address the shortcomings in the food supply chain that we are leading the way to act, in accordance with the Commission's longstanding position to stand by European farmers. I encourage all EU citizens, farmers, stakeholders to share their views with us through this online consultation."

The European Commission is interested in gathering input to assess the necessity and expedience of possible measures to be taken at the EU level to address or regulate unfair trading practices with respect to agrifood products.

The Commission is also keen to assess the level of market transparency across the chain and where it can be improved. Considering the need for some degree of competition, the consultation will help to judge whether the introduction of supplementary EU market transparency arrangements is necessary.

Finally, the questionnaire scans the level of interest in producer cooperation and the use of so-called value sharing agreements (namely the sharing of market bonuses and losses resulting from evolutions of the relevant market prices), which are already in use in some sectors such as sugar.

The consultation draws on the work of the Agricultural Markets Task Force (AMTF), set up by Commissioner Hogan in January 2016. The AMTF suggested a number of concrete ways to strengthen the position of farmers in the food supply chain, and the consultation will build on this work to inform the Commission's potential future work.