EU Commission wants to strengthen farmers’ position in the food chain

The European Commission presented a set of ideas aimed at bolstering farmers in the food supply chain in a document shared with EU member states, responding to demands growers voiced in recent protests for fairer compensation for their work.

The document, shared with EU countries on Friday (15 March) and seen by Euractiv, acknowledges that a “small number of large companies” dominate the food industry while the agricultural sector remains highly fragmented and mostly made up of small and medium-sized businesses, leaving farmers in a weak position.

“Even the largest farms find themselves often in a vulnerable position in the agri-food supply chain due to limited bargaining power vis-a-vis highly concentrated and stronger actors,” reads the document drafted by the Commission, which refers to food retailers as “gatekeepers to consumer markets”.

Additionally, the text points out other challenges faced by farmers, such as the seasonal and cyclical nature of agricultural production, as well as uncertainties linked to unfavourable weather conditions.

“While business risks are inherent in all economic activities, agriculture is particularly prone to uncertainties,” the document adds.

Cross-border enforcement

To tackle these issues, the Commission is presenting immediate non-legislative measures, including the creation and launch of an observatory to track trading practices, margins, and costs in the EU’s agri-food supply chain, with the inaugural meeting scheduled for June.

Furthermore, after the summer, the EU executive plans to introduce new rules to ensure cross-border enforcement of the EU’s directive on unfair trading practices (UTPs), which bans certain abusive behaviours by large buyers against farmers. 

The additional measures would target multinational food and retail companies that bypass unfair practices legislation by operating in multiple EU member states. 

The French government, for one, has repeatedly demanded reinforcement of these provisions since they allow retailers to relocate their purchasing centres from countries where the national legislation is more strict, like France, to member states where rules are more favourable.

France calls for stronger farmer protections in supply chain negotiations

French President Emmanuel Macron has called for greater protections for food producers through a ‘European Egalim’ law, a reference to French legislation that regulates trade negotiations with supermarkets and manufacturers.

The proposal will also seek to give more power to national enforcement authorities in cross-border cases and ensure cooperation and information exchanges between different member states.

Moreover, the Commission will assess the implementation of the UTPs directive in the agri-food chain in a report to be published in April. In 2025, it will conduct an in-depth evaluation of the rules and, if necessary, propose legislative changes.

Another measure being considered is to change the EU’s Common Market Organisation Regulation (CMO), in a proposal that could be issued in May.

This could involve strengthening the rules for contracts between farmers and buyers, supporting farmer associations and producer organisations, and encouraging voluntary fair-trade schemes to ensure farmers are paid fairly without burdening businesses.

Positive reactions

The proposals have garnered positive reactions from farming groups, with Copa-Cogeca, the EU’s most influential farming lobby, welcoming the measures while emphasising the need for “increased transparency in the functioning of the food chain” and “reduced administrative burden.”

“We hope that both the Council [of the EU] and the European Parliament can rapidly go ahead with the analysis of the proposals in this area,” Copa-Cogeca said in a press release.

Similar comments were echoed by Camille Perrin, a senior policy officer at the European consumer organisation BEUC, who told Euractiv that more transparency is needed regarding where consumers’ money goes if it does not reach farmers. 

“Are there greedy actors in the chain taking a bigger share of the cake than they reasonably should?” inquired Perrin, who explained that the creation of an observatory could bring some clarity to this issue.

French farming organisations FNSEA and Jeunes Agriculteurs have praised the Commission’s efforts to address farmers’ vulnerabilities in the food chain and their financial situation, particularly highlighting the importance of preventing multinational purchasing groups from circumventing EU laws on unfair practices.

The French Ministry of Agriculture also praised the proposal for new rules on the cross-border implementation of the UTPs directive, which it said aligns with France’s requests. 

[Edited by Angelo Di Mambro and Zoran Radosavljevic]

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