The British Free Range Egg Producers Association is to create a model supply contract for members to use with packers, after claiming many contracts it had seen were “not worth the paper they are written on”.
The model contracts would “ensure fairness and confidence throughout the sector”, said BFREPA CEO Robert Gooch. It was “vital” all producers had “rock-solid agreements in place”, particularly as many new entrants were joining the sector, he added.
A clear commitment to egg price for the duration of the contract, or terms linked to the fluctuating price of feed, would be key components, as many contracts seen by the trade body made no reference to either, Gooch said.
It follows a tough summer when the farmgate price of free-range eggs fell due to oversupply, while drought conditions increased feed bills by 50% for some producers.
“It is alarming to see so many contract examples with no reference to the price producers will be paid for their product,” Gooch said. “My members need to know where they stand so they can continue to invest in their business.”
Other elements to be examined will be notice periods and procedures for the transfer of accreditation scheme rights at the end of a contract.
“Our vision is that all free-range egg businesses have fair, meaningful contracts which guarantee a supply of high-quality free-range eggs to consumers at a sustainable price for producers,” Gooch added.
BFREPA aims to launch the model contract by the end of the year.