Further detail on new regulations to improve fairness and transparency in the dairy supply chain has been announced.
The government said these regulations, which are set to come into force later this year, will also help establish “stability and accountability” across the dairy supply chain.
Under the new regulations, farmers have clearer pricing terms, with contracts setting out the factors which generate the milk price.
Farmers will be allowed to challenge prices if they feel this process isn’t being followed and changes to contracts can’t be imposed on farmers without their agreement.
Farmers’ contracts will also include a straightforward way to raise concerns about their contracts and there will be clear rules put in place on notice periods and contractual exclusivity, protecting the rights of both buyers and sellers.
An enforcement mechanism will be in place to guarantee the regulations are followed.
New regulations
The new regulations are part of a series of supply chain interventions confirmed by the government. This autumn, reviews will also begin to help establish fairer supply chains in the egg and horticulture sectors, and later the pig supply chain.
Industry stakeholders, including the National Farmers’ Union (NFU) and Dairy UK, were consulted in their creation, and the government said there will be “continued engagement” with industry to ensure that they meet the needs of the sector and properly address the challenges the sector faces.
Commenting, Farming Minister Mark Spencer said: “Farmers must be paid a fair price for their produce and these regulations will provide price certainty and stability for farmers by establishing written milk purchase agreements with clear and unambiguous terms.
“This represents a key milestone in our commitment to promote fairness and transparency across food supply chains to support farmers and build a stronger future for the industry, and will be followed by reviews into the egg and horticulture sector supply chains this autumn.”
NFU dairy board chair Michael Oakes added: “These new regulations mark a significant step forward in the government’s efforts to increase fairness and transparency in the dairy supply chain.
“For a long time, unfair milk contracts have held British dairy businesses back, and these changes will give dairy farmers much needed business security and confidence, as well as helping to share risk along the dairy supply chain.”
