Campaigning to curb supermarket power



"Having travelled to many countries to meet farmers it was very clear that supermarkets treated all farmers equally  - unfortunately that is equally badly and it was the name of Tesco which came up time and time again. If we are to have a future as farmers and sustainable agriculture then we need to control supermarket power."
Michael Hart, chairman of Small and Family Farms Alliance

Supermarkets don't pay farmers a fair share of  retail prices

Thousands of farmers and farmworkers are forced to leave agriculture each year because of the low prices they receive for their produce. Farmers' organisations believe that a major contributory factor to this crisis in British farming is the increasing buying power of supermarkets and their ability to squeeze suppliers. According to the 2009 Competition Commission Report the buying power of the major supermarkets means that the burden of cost increases in the supply chain has fallen disproportionately heavily on small suppliers such as farmers. These  lower prices are not necessarily passed onto shops and often have a “detrimental effect on consumers”.

Focus on the 'Supermarket Wars' have shown that supermarket prices and discounts are paid for by reducing payment to suppliers. The National Farmers' Union have claimed that due to price squeezes, one dairy farmer has gone out of business every day for the past decade. Pig farmers claim that they lose £3m per year effectively subsidising Tesco. Supermarkets merely increase their profit margin.

Farmers have to bear the burden of unfair trading practices imposed by supermarkets.

Supermarkets control nearly 80% of the British grocery market and as the most powerful players along most food supply chains are able to dictate terms, conditions and prices to suppliers. If suppliers complain, supermarkets can simply move their business elsewhere, and their dominance of the food retail sector is such that there may simply be no one else for farmers to sell their produce to. 

In November 2010 NFU President Peter Kendall launched a stinging attack on retailers, accusing them of creating a climate of fear in the dairy sector through ruthless and erratic negotiation. He accused retailers of forcing processors to sign confidentiality agreements to ensure negotiation details remained under wraps, keeping the supply chain "dangerously in the dark". 

More details about the damage caused to farming by supermarkets: