Supermarkets have ‘super power’ over farmers – Commissioner Phil Hogan
The Commissioner was speaking at a Food Safety Authority of Ireland conference in Dublin on Friday.

Supermarkets have a disproportionate leverage over primary producers of food, which must be addressed, European Agriculture Commissioner Phil Hogan has said.

Speaking at the FSAI Safeguarding The Food Chain conference in Dublin Castle on Friday, Commissioner Hogan said supermarkets now enjoy “super power” due to the twin effect of increased globalisation and a high level of concentration within Europe.

“The imbalance of bargaining power between price-setters and price-takers is stark,” he highlighted. “Leading to a situation where there is a real fear factor for farmers of commercial retaliation, late payments and other headaches.”

Fear factor

Commissioner Hogan said that the farmers’ share of what EU consumers spend on food is being continuously squeezed, due to the “clear imbalance of power between producers and other links of the food supply chain”.

He warned that regulators and policymakers can never afford to lose sight of one fact: without the primary producer, there is no food supply chain.

“And primary producers can only do their vital work if they receive a fair buck for their work,” he added.

“A well-functioning food supply chain is essential for our society. Farming, food processing, retail and food service represent over 44m jobs in 14m businesses across the EU,” he said.

“This is one of our biggest employment sectors. And our consumers can only be guaranteed a reliable food supply if farmers are guaranteed a reliable income and a fair share of the pie.”

Tackling unfair trading practices

Commissioner Hogan referred to planned moves to tackle unfair trading practices, and said the Commission is now moving to the next step of drafting a legislative proposal.

“It is my sincere hope that all the stakeholders who recognise the problem will also proactively support the potential solution.”

Read more

Food chain reform moves closer

Long road to tackle unfair trading practices

Brexit will create a 'new scale' of milk crisis – EDA
The European Dairy Association is the representative body of dairy processors in the European Union.

Brexit would create a “new scale” of milk crisis, according to the European Dairy Association (EDA). But it is hopeful that recent developments in the UK mean that this week is an opportunity to ensure that Brexit does not happen.

“Brexit has the potential to create a completely new scale of a milk crisis”, EDA chair Michel Nalet wrote in a letter to EU Council President, Donald Tusk and representatives of EU member states.

“A no-deal would be disastrous for dairy farmers and consumers on both sides of the channel. This week is an opportunity to ensure that this doesn’t happen. It is a time of responsibility of all decision makers involved.”

Across the European Union, there are 700,000 dairy farms, 12,000 milk processing sites, and more than 300,000 people working in the sector.

The EDA said that if the UK asks for an extension of Article 50 beyond 29 March 2019, then the European Council should accept such a request.

“We would urge both sides to come together to work out the final details. This will ensure a smoother exit and importantly a transition period that will allow negotiations on an ambitious future trade relationship to begin quickly.”

The EDA said that the UK should leave the EU with a deal that protects the close trading relationship and ensures the long-term viability of the EU dairy sector.

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Farmer Writes: the Brexit bus battles on and the driver has no control

Speaker adds new twist to Brexit by ruling out May's withdrawal agreement option

Creed backs proposal to put limit on direct payments
Minister Creed said he supports the removal of a salary exemption from the European Commission's proposal to cap direct payments above €100,000.

Minister for Agriculture Michael Creed has given his backing to a proposal which would pave the way for Ireland to introduce a limit on direct payments in the next CAP.

As part of draft European Commission proposals, payments would be capped at €100,000 and deductions would be applied to those above €60,000. However, farm salaries would have to be deducted first before any limit would apply.

Cumbersome

At a meeting of European agricultural ministers on Monday, Minister Creed supported a proposal for member states to have the option of whether to include a salary exemption or not. He said the option to deduct labour costs would undermine the policy and that it would be administratively cumbersome to implement.

However, he added that there should be no limit on the amount farmers could receive under agri-environmental schemes, particularly the newly proposed eco-scheme in pillar one. Payments to young farmers should also be exempt from any restrictions.

Budget

Minister Creed emphasised the importance of securing a well-funded CAP. He said without an adequate budget, ambitions will remain ambitions.

“It is not feasible to ask farmers to do more and more and more and yet collectively decide we will pay them less and less and less. Farmers won’t thank us for that and I don’t think society will thank us for that.

“The proposals as published do not represent an adequate budget for the ambitions we have in the years ahead.”

Much of the commentary supporting cuts to Europe’s agricultural budget has centred on new obligations in areas such as defence and immigration. Minister Creed said funds for new challenges should come from new money rather than robbing money from CAP.

Speaker adds new twist to Brexit by ruling out May's withdrawal agreement option
UK prime minister Theresa May's strategy was to have MPs choose between her withdrawal agreement and a no-deal Brexit but the speaker has taken the wirthdrawal agreement option off the table.

The UK's House of Commons speaker John Bercow has become a familiar figure in Brexit debate. He is centre stage when announcing votes in parliament, an exercise he carries out with considerable drama. However, on Monday he became the news agenda when he announced that he wouldn’t allow the prime minister bring back her withdrawal agreement for a third vote without it being substantially changed.

Theresa May already had a major job on her hands to make it third time lucky with the vote in parliament. Since last week, she has been focusing her attention on the DUP. The publication of her tariff proposals last week with Northern Ireland a back door for Irish exports to the UK was a clear signal that Northern Ireland was going to be treated very differently for Irish trade compared with trade via the main ports of Holyhead and Fishguard.

Since the second vote, the DUP have appeared to be softening their opposition, as have a number of pro-Brexit MPs. Until the speaker's intervention on Monday, the debate was revolving around whether the prime minister could persuade enough to get her withdrawal agreement through parliament at the third attempt.

Impact of the decision

The announcement by the speaker that he wasn’t allowing the withdrawal agreement back before parliament for a third attempt makes an already uncertain process even more so. The prime minister was already accepting that the UK would have to seek at least a short extension because there simply isn’t enough time left to put the legislation in place before 29 March. The Brexit minister in the UK government, Kwasi Kwarteng, confirmed during the debate in parliament on Monday that the UK would be applying for an extension beyond the 29 March departure date but as of yet there is no indication of how long this extension might be.

Default position

Theresa May’s government was in a difficult enough place already as the clock counts down to departure, a mere 11 days from now. As things stand, the one policy that is in place is that the UK will depart on 29 March. Something needs to win parliamentary approval to prevent this happening.

For the prime minister, she had staked everything on her withdrawal agreement and her strategy seems to have been to keep presenting it - as the clock ticked down, it appeared that she had hoped to get enough support because the no-deal alternative was worse.

Farmer exposure

As always, it is farmers who are most exposed if the no-deal outcome becomes the reality and the risk of it happening increased on Monday.

The bottom line is that Theresa May was giving MPs two choices in the final days: either her withdrawal agreement or a no-deal departure. The speaker has just removed May's option, which as of now just leaves the no-deal alternative and the biggest nightmare for farmers.