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Dairy Farming

Question for Department for Environment, Food and Rural Affairs

UIN HL6362, tabled on 23 February 2016

To ask Her Majesty’s Government what progress they have made towards extending the remit of the Grocery Code Adjudicator to the contractual relationship between small family dairy farmers and dairy processors.

Answered on

7 March 2016

The Government introduced the Groceries Code Adjudicator (GCA) to enforce the Groceries Supply Code of Practice (the Code) which regulates the relationship between the UK’s ten largest supermarkets and their direct suppliers. The Code was put in place in 2009 by the Office of Fair Trading (now the Competition and Markets Authority), following a market investigation by the Competition Commission. The Code will be reviewed shortly.

The dairy industry code of best practice on contractual arrangements was created in Great Britain in 2012. Among its provisions is a requirement for 30 days’ notice of a cut to a farmer's price or other significant change to contractual terms. In addition, a farmer who disagrees with a proposed price change or significant change to contractual terms can exercise a right to terminate the contract on three months’ notice. About 85% of processors have signed up to it.