MPs are set to heap further scrutiny on the relationship between retailers and suppliers with a new inquiry into farmgate prices.
The House of Commons Environment Food and Rural Affairs Committee announced yesterday (17 September) it was embarking on the new inquiry in the wake of a summer of turmoil and protest in the farming sector, and a collapse in the price of products including milk, lamb and wheat.
A statement by the committee said “changing global markets and national conditions have made prices volatile”, with consumer choices, EU, UK government, and individual retailer and processor policies all shaping markets and having a significant impact on prices paid at the farmgate.
“The committee wishes to inquire into the impact of these and other factors on farmgate prices, and measures that could be taken to improve prospects for the agriculture industry,” it added.
Committee chairman Neil Parish told The Grocer the inquiry would look at “both what the producer is being paid and how the sector is working”, and pointed out he would seek to “take evidence from retailers regarding the very competitive situation in the retail sector at the moment and how that affects profitability”.
Efra is inviting written submissions on which sectors are affected by falling prices, the main causes of the price reductions, and the anticipated short, medium and long-term impacts on the dairy, meat and arable sectors.
It will also look into the government’s role in securing and supporting UK food production, and the effectiveness of EU measures, in addition to what support, if any, processors and retailers should give to UK farmers and produce, and the effectiveness of the regime established under the Groceries Code Adjudicator.
The deadline for submissions is 12 October.
The committee is set to take evidence from environment secretary Liz Truss and Defra permanent secretary Clare Moriarty next month on the department’s success in delivering its key policy priorities, and is likely to take evidence on the farmgate inquiry later this autumn.
This comes amid fears Groceries Code Adjudicator Christine Tacon’s investigation into breaches of the Groceries Code of Practice was being delayed by a reluctance of suppliers to give evidence against the retailer. The Grocer reported this week that suppliers were too worried to give evidence to Tacon because they feared being dragged into the ongoing Serious Fraud Office investigation into the retailer over its accounting practices.
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