Farmers and growers have reacted with scepticism after Environment Minister told them to ‘stand their ground’ in order to obtain higher prices from customers such as supermarkets, adding that higher farm gate prices need not lead to higher prices in store.
Speaking online at the Oxford Farming Conference, Eustice said, “We do need producers to stand their ground and take quite a tough position with retailers to ensure that the money they are paid reflects the costs of their production… You can have reasonably modest increases in farm gate prices, and significant impact on farm profitability, that does not result in major changes to consumer inflation.”
On the same day, Asda announced that it was cancelling its commitment to exclusively sell British beef after just three months, after an increase in prices. Eustice also said that prices should rise so that farmers do not have to rely on cheap labour.
Martin Lines, UK chair of the Nature Friendly Farming Network, commented, “It’s very difficult for individual farmers to stand their ground against price pressures from retailers who hold all the bargaining power. There is a role for the government to play in giving farmers more power within the supply chain, so they are fairly rewarded for food produced to high environmental standards.”
George Dunn, the chief executive of the Tenant Farmers Association, added, “There is significant imbalance within the supply chain with retailers and food service operators able to wield significant power within the supply chain. Down the years, there have been warnings about the sustainability of the ‘cheap food culture’ to which we have become accustomed, and it seems now we are seeing the fulfilment of those past prophecies of doom. However, retailers and food service providers have the means to avoid a catastrophe by allowing their prices to increase.”
Photo caption – Environment Minister, George Eustice