NFU win – government promises new egg supply chain regulations

At the annual Farm to Fork Summit at Downing Street, the government committed to further action to ensure fairness across the supply chain, delivering regulations to improve fairness in the egg sector. 

Outcomes

Defra has committed to:

• introduce regulations which will ensure that there are written agreements between producers and buyers.
• work with industry at pace on the regulations to ensure they deliver fairness to all parties.

NFU win

NFU Poultry Board chair James Mottershead said:

“I’m pleased that Defra’s review of fairness in the egg supply chain is moving forward, with draft regulations for egg contracts set to be developed and a clear intention to work with the NFU and the wider egg sector on data availability and transparency – both of which we asked for.”

The NFU's response to Defra's egg supply chain consultation represented both members issues and views, as well as offering up potential solutions to help shape future fairness in the supply chain. 

An overwhelming majority of members who submitted feedback wanted contracts between buyers and sellers of eggs to be written, ensuring that both parties can agree the terms of any contract and refer to it for the purposes of resolving any potential dispute.

It was also highlighted that there is currently some confusion amongst producers as to the form and/or level of agreement that relates to contracts being in place and we have urged the government to get a better understanding of this before making any recommendations as an outcome of the consultation.

Additionally, members reported a lack of confidence in negotiating terms and conditions in their contract to suit their business needs.

The NFU believes that a strong legislative baseline is needed to regulate transparency, certainty, and fairness in contracts. However, a one-size-fits-all approach will not work due to the variety of businesses operating in the sector; therefore flexibility in terms of options is important.

Other areas addressed in the NFU's consultation response included the need for better availability and transparency of data, the desire for clear and concise guidance to accompany any legislative changes, and an ask for a commitment from government to further engage with stakeholders from across the egg supply chain before any legislative changes are proposed to ensure the best possible outcome for all concerned.

This consultation is now closed for responses.

Following extensive NFU lobbying, Defra has announced that it will be conducting a review into ending unfair practices in the egg supply chain.

It follows on from a commitment made earlier in the year by the Prime Minister at the Farm to Fork Summit in Downing Street.

“At the Farm to Fork summit in May, the government pledged to support the farmers by undertaking a review into the egg sector to ensure fairness moving forward,” said Defra Secretary of State Thérèse Coffey.

“I would now encourage all stakeholders from across the industry to take part in this review to ensure their voices are heard.”

The NFU gathered extensive feedback to include in its consultation response. Members joined regional and national meetings, and submitted their views via online surveys and webinars.

Egg farmers could also submit their views directly to Defra at: GOV.UK | Contractual relationships in the UK egg industry before 22 December 2023.

The NFU's member-exclusive consultation session on the egg supply chain is available to watch again at: Watch again – The future of the egg supply chain

In December 2022, the NFU called on Defra to investigate the egg supply chain amid a backdrop of rapidly increasing input costs, avian influenza and the war in Ukraine. Increasing pressures led to a combination of constrained supply and higher demand resulting in issues around availability of eggs in some stores for some retailers.

“Reform is long overdue,” said NFU Poultry Board chair James Mottershead. Almost one billion fewer eggs were packed in the UK in 2022 compared to 2019.

He added: “It is critical that appropriate steps are taken by all stakeholders, including the government, to improve fairness and transparency in the egg supply chain, so that volatility and enormously challenging market conditions are avoided in the future.

“Transparency and trust are key to improving producer confidence and the sharing of risk and reward more fairly throughout the supply chain will ensure a consistent supply of high-quality, nutritious and affordable poultry products that we know the British public desire”.