Pork processors will be held to more rigid price contracts with farmers under new laws put forward by the government last week, the National Pig Association has said.
Following a public consultation, Defra committed to introduce new laws to ensure written agreements were used between all producers and their buyers.
The NPA said the new legislation planned by the government department would make a “fairer and more sustainable environment for pig producers”.
“For too long, producers have been treated poorly and contracts have not been worth the paper they were written on – and we have seen some disastrous consequences of that behaviour over the past two years,” said NPA chair Rob Mutimer.
“We believe the measures set out today, including legal underpinning for contracts that delivers a fair transparent and negotiable contract system, will help deliver a fairer and more sustainable environment for pig producers,” added Mutimer.
The NPA said that the commitments addressed most of the key asks it had put forward in October 2022. However, the organisation stressed that wider issues further up the supply chain, including the actions of retailers, must also be addressed.
“The bottom line is that, while legislative changes can set the framework for reform between the producer and whoever they have their contract with, real change must also come from within the supply chain,” added NPA CEO Lizzie Wilson.
Wilson added one-fifth of breeding capcity had been lost as a result of two years of crisis, which meant producer confidence was low.
“That will only change if pig farmers can see that retailers and processors have got the message that fundamental reform is needed if we are to secure supplies of high welfare, environmentally friendly assured Red Tractor British pork in the future,” she said.
The public consultation kicked off in July 2022 after thousands of healthy pigs were culled on farms due to lack of space caused by a post-Brexit shortage of butchers and a slump in demand from China.
The consultation received over 400 responses and revealed that the majority of respondents supported plans to introduce legislation to require written contracts.
Defra said the new regulations would “help to bring stability and security to the pig supply chain, strengthening the sector’s ability to deal with the challenges currently being faced”.
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The government also commited last week to developing regulations to collect and share more supply chain data, particularly in relation to wholesale price transparency and national slaughter numbers. It said this data would help to further reduce ambiguity.
The NPA said the increased availability of data would support the industry in understanding the market and forecasting.
Defra will be sharing the consultation’s findings with the Competition & Markets Authority in response to concerns around the negative impact processor consolidation is having on producers.
Farming minister Mark Spencer said: “We are committed to working with the sector, and the regulations set to be introduced will ensure fairness and transparency across the supply chain – from pig to pork to plate – to help the sector to thrive in the future.”
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