It is clear that retailers do not yet feel threatened by the current proposed legislation on Unfair Trading Practices, Sinn Féin MEP Matt Carthy has said.

The MEP for the Midlands North West has been appointed shadow rapporteur by the European Parliament to examine the long-awaited proposal from the European Commission which purports to deal with unfair trading practices in the agricultural sector.

Carthy has said that his priority is to strengthen the proposal so that it will outlaw the practices of retailers and processors which result in farmers being often forced to sell their products at below production-cost prices.

The weakness in the Commission’s draft can be seen in the muted response from the large retail representatives

“Commissioner Phil Hogan recently acknowledged to me in a European Parliament debate that his proposed legislation could have been stronger but he argued that it was better to start with a weaker position in the hope that it would be strengthened in negotiations with the council and parliament.

“This appears to be a bizarre approach to take considering these proposals have been promised for several years and this process may be the only opportunity to protect farmers from oppressive business relationships for a generation.

“The weakness in the Commission’s draft can be seen in the muted response from the large retail representatives.

“If the proposals genuinely signalled a shift in favour of farmers the retail lobby would be responding in force. Instead it is clear that they do not yet feel threatened by the proposal.

“That leaves a challenge for the European Parliament to amend the legislation to really address the imbalances in the food market,” he said.

Mandatory price reporting

Carthy said that while he welcomed the introduction of many price observatories in the agriculture sector it must be complimented by mandatory price reporting.

He also said new generation contracts are needed, where risks are shared rather than resting entirely with the farmer.

“One of the most striking absences from the Commission’s proposals is any attempt to tackle below cost of production buying.

“It now seems to be considered a revolutionary concept to suggest that farmers should receive a price above the cost of production for their goods.

“The proposal also allows a number of unfavourable practices to remain if set out in the contract. These allow buyers to drive the farmer’s profit margin close to zero or even less,” he said.

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