Clive Beddall
Britain's farmers are calling for the principles of the DTI's code of trading practice for the top five supermarkets and their suppliers to be enforced across the entire food industry.
The Grocer has learned that the NFU told the Office of Fair Trading that the code should be "used as a template for all trading relationships between buyers and sellers in the chain."
The farmers, like many small to medium sized food manufacturers, had earlier called for the code to be extended to all supermarkets, rather than just the top five.
It's submission declares: "We see no reason why the code should not be applied to all supermarkets. Indeed, a number of our members feel that trading relationships with some of the smaller supermarkets can be just as demanding."
But in the detailed submission put to the OFT last weekend, which The Grocer has seen, the farmers also argue that there are many cases where smaller producers do not supply retailers but do supply processors or packers "who exercise undue buying power comparative to those of the retailers." Therefore, they believe the principle should extend across the entire chain.
And given that other organisations, including the main suppliers organisation Food and Drink Federation have also criticised the draft code as "woolly and vague", pressure on minister Stephen Byers to widen his original brief for the code is mounting.
For weeks, there have been suggestions from manufacturing sector figures that Byers must eventually apply the code across all multiples.
But now that the influential NFU is arguing it should be an all-industry mechanism, the support for an extension of its brief is likely to heighten.
However, so far, OFT officials have stuck to the letter of Byers' law and insisted their role is merely to apply it to the top five. Whitehall insiders, on the other hand, say Byers is hoping that a legally binding code for the top five will encourage other parts of the industry to follow the code more broadly.
The NFU argues that the draft code does not effectively tackle the problem of supermarkets demanding contribubutions from suppliers.
"Neither does it address the issue of supermarkets forcing farmers and growers to pay compensation when profits from the sale are lower than expected, or for wastage of products incurred at stores."
And while NFU officials have been at pains to point out that relationships between the farmers and the supermarkets have "improved significantly during the past few years," NFU president Ben Gill believes the draft code is "littered with problems, both generic and specific".
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