New measures to eliminate unfair treatment of food suppliers by powerful retailers have been promised by EU Agriculture Commissioner Phil Hogan.

Speaking to Irish journalists in Brussels on Tuesday, Hogan said it was clear that a voluntary code was not working and suppliers were still not getting a fair price from supermarkets for their produce.

“We are looking at new models and new frameworks in legislative terms, that will actually concentrate the minds of all the actors in the food chain, so that the producer should not be squeezed anymore.”

Margin

He said there has been a considerable reduction in the proportion of the margin going to the primary producer.

“Voluntary codes don’t seem to work in concentrating minds of retailers,” he said. “I am looking at the models in the UK and Spain where they have put in adjudicator.”

The Commissioner points out that if producers were forced out of business because of a lack of profit “we won’t have a product, and we need product more than ever before when you look at the growing population”.

In a subsequent discussion, Fine Gael MEP Maireád McGuinness and Independent MEP Marian Harkin welcomed the commissioner’s comments.

Mairead McGuinness noted how Irish retailers had not engaged in below-cost selling of vegetables pre-Christmas 2014 after the strong campaign against the practice in 2013.

Brussels sources say that securing political approval for any legislation in this area will be difficult, with many MEPs and member states opposed to measures that they believe could increase food prices.

Yesterday, MEP Mairead McGuinness highlighted figures from the European Commission, showing that the producer’s share dropped from 31% in 1995 to 24% in 2005, and had further declined to 21% by 2011.

“The 2011 figures compiled by Eurostat show that farmers receive 21%, the food industry gets 28% and the remainder, 51%, goes to food retail and food services.

“Receiving slightly more than one-fifth of the price consumers pay for food is an insufficient share for those who provide the lion’s share of the input,” she said.

“Farmers invest the greatest effort and time of all stakeholders in the food chain and also carry the greatest risks, including weather impacts.

“I believe the Commission needs to acknowledge this and quickly move to legislative action,” she concluded.