Fairness in the food supply chain: Commission proposes to increase price transparency

Having banned unfair trading practices and improved producer cooperation, the Commission is presenting the third element to improve fairness in the food supply chain by introducing greater transparency in the way prices are reported throughout the chain.

The European Commission tabled a proposal that will make available crucial information on how prices are determined as agri-food products move along the food supply chain.

Buying and selling price differences can provide information about intermediary costs (such as transport, insurance, storage, etc.) between seller and buyer. Greater transparency can support better business decisions and improve trust in fair dealing between the stages in the food supply chain. Having access to timely and easily accessible information about market developments is also key to compete effectively in global markets.

Agriculture and rural development Commissioner Phil Hogan said: “Strengthening the position of farmers in the food supply chain has been a priority for the Commission. Enhancing market transparency will allow equal access to and greater clarity about price information, making our food chain fairer and better balanced. These new rules will complement the recently adopted directive banning unfair trading practices in empowering weaker and smaller actors of the food supply chain and their introduction reflects the very significant public support that there is throughout the EU to strengthen the role of the farmer in the food supply chain.”

While there is a large amount of information available about developments in agricultural markets (prices, volumes of production, stocks, etc.), there is almost no market information about other key markets in the agri-food supply chain, namely those that operate between farmers and consumers at the food processing and the retail level. This asymmetry of information between farmers and the other actors in the food supply chain puts farmers at a significant disadvantage in the market and erodes trust in fair dealing. This lack of information on market developments from processors and retailers has been called the ‘black box’ of the agri-food supply chain and this proposal unlocks that box.

The proposed measures will cover the meat, eggs, dairy, fruit and vegetables, arable crops, sugar, and olive oil sectors. They build on existing data collection systems and procedures that are already in place and used by operators and Member States to report market information to the Commission, with a now wider scope. Each Member State will be responsible for the collection of price and market data

According to the Commission’s Better Regulation procedures, the proposal is now published for a 4-weeks’ public consultation period. It will then be adopted by the European Commission and is planned to enter into force six months after its adoption.

Original source: European Commission
Published on 22 May 2019