Farmers Fight for Fair Value

Farmers unite under the banner of fair value

It is often said that the farming community is made up of silos. This is undeniably true to some extent, although there are two areas on which farmers and growers from across the industry agree. Food security. And fair value in the food supply chain.

RPG has been banging this drum since it was established five years ago; bringing politicians and academics together with farmers to align thinking and give farming a voice in Parliament. The NFU are equally vocal on these issues and yesterday Minette Batters spoke to Prime Minister Rishi Sunak at the NFU Conference.

This singularity of message from various quarters representing farmers and growers is edging food value up the governmental to do list.

Prime Minister Rishi Sunak discusses food security with the NFU’s Minette Batters

At the NFU conference yesterday, Rishi Sunak announced plans to boost food security and made a number of similarly promising pledges for farmers.

Those pledges include an annual food security index which will be made statutory in due course, with the first report being published in time for Number 10’s second Farm to Fork Summit this spring. The Prime Minister also promised the Summit would become an annual event to give voice to the farming community and close the dialogue gap between farmers and Westminster policymakers.

The food security index is intended to capture the data needed to monitor trends in the UK’s food security. This will be a welcome snapshot of progress against target each year, but it needs to be backed up by policies which support buying British rather than imports where possible and which encourage investment in food production.

“I think we focus sometimes on the headline number, 75% self-sufficient in the foods that we can actually produce, but we need to improve on that,” Sunak said, in conversation with NFU President Minette Batters. “That’s something I think we all want to see, it’s something the British public want to see.

“The events of the last couple of years have demonstrated how important that is and that headline number, whilst respectable, underneath there are categories where there has been very surprising lack of self-sufficiency in areas.”

Pressure mounts on Parliament to address fair value in the food supply chain

Minette Batters, in her final address to the NFU conference in Birmingham, urged “all food retailers and most importantly their stakeholders” to address issues of fairness in the food supply chain.

Echoing the sentiments of The Rural Policy Group, she said, “You have a duty to your farmers and growers…They have a right to earn a fair price for what they produce, for you to sell. This means the culture at the top of food retail has to change.”

In 2023 Shadow Environment Secretary Daniel Zeichner and Rural Policy Group set up the All-Party Parliamentary Group on Fair Value in the Food Supply Chain to address issues around margin shares and contract terms within Parliament and encourage government to support a collaborative review of current practices and regulatory instruments, such as the Groceries Code Adjudicator. Whilst crucial to the future of British farming, reform in the food supply chain will not be simple.

Minette Batters called for the development of KPIs within the supplier framework, and the embedding of supplier fairness rules within company ESG guidelines.

While margins are slim throughout the supply chain, it is the power imbalances between trading partners, between farmer and supermarket for example, that need addressing as a matter of urgency. Farmers being price-takers, being unable to influence payment terms or product standards, or being scared of being delisted for calling out poor practices undermine the whole food system. And our ability to deliver high standard, high welfare, environmentally sustainable and nutritious food to the nation.

Batters suggested ownership of the issue needed to be addressed at board level. However, while retailers have huge influence over the businesses in their supply chains, they are competing in a highly competitive marketplace which is driven by low prices. The growth of discounters will only intensify this competition and the repercussions will reverberate throughout the supply chain.

Many supermarkets are proud of their suppliers and feature them prominently in marketing campaigns, in-store promotions and packaging. We believe retailers want to support British food producers and encourage their consumers to buy British; the sticking point is price, affordability and how food value is perceived by consumers. It is an unfortunate truth that price trumps provenance for most shoppers. This decision making affects multiple and farmer in the same way and working together to encourage the consumer to re-evaluate to importance of quality is in all our interests.

At RPG we believe that food security is a pipedream without fair value in the food supply chain. The disinvestment from food production in recent years is testament to this. However, the reforms needed to secure the future of British farming will need to come from within the supply chain, from consumer expectations of food pricing and from innovation to enable British farmers to compete on the global stage with countries who have lower standards and lower costs of production.

Sunak uses the NFU Conference to pledge a £427m package of farm funding

At RPG we are delighted Rishi Sunak is pledging £427m in support for farmers to help with technology and productivity programmes, to fund cost-saving energy measures and to safeguard land for food production. The funding will also support schemes to help farmers retain more of the value-added from their product through support for processing, packing and retailing on farm. New legislation around permitted development rights is also coming into force in April so farmers can develop buildings and diversify earnings through farm shops, commercial space and sporting venues.