PROCESSOR CODE OF PRACTICE FOR THE PURCHASE OF CATTLE

The purpose of this voluntary code is to provide an industry standard that sets out a framework for transparent commercial relationships across the beef supply chain.

Signatories to this code commit themselves to the following principles and practices, and to reflect them in their own customer relationships:

1. To provide open and clear information about their company’s terms and conditions of trading, and to make this available to their current and prospective producer suppliers, including:

– The base price, specification grid and target grades

– Premiums and deductions from the base price according to weight and grade, sex, age, non-British animals, non-assured status and other relevant factors

– Other premiums or deductions

– Dressing specifications

– Weighing practices

– Statutory levy charges

– Other processing charges borne by farmers

– Other relevant terms and conditions[1]

– Period within which payment will be made to producer suppliers

– Other relevant specifications, such as food chain information, provenance and traceability, animal movements, assurance status of animals, animal health and welfare, feed, animal transport, clean livestock policy

2. To give at least 12 weeks’ notice of changes to company terms and conditions of trading[2]. Where age is reduced, to give a notice period corresponding to the change in age.

3. To provide clear information on any changes to company terms and conditions of trading to farmers who are current producer suppliers.

[1] For example, the terms of any company insurance charges, which will be clearly set out. [2] Excluding changes to the base price, and subject to ‘force majeure’.

Farmers and abattoirs have launched the beef sector’s first code of practice to make processor-producer dealings more transparent.

Processors will have to give farmers 12 weeks’ notice of any changes to terms and conditions under the new guidelines.

All farmers should also be able to clearly find each processor’s details such as pricing grids, target grades, premiums and deductions.

See also: Livestock market outlook for 2015

The NFU and British Meat Processors Association (BMPA) have been working on the code since last July’s beef crisis summit, held after prices crashed from all-time highs.

NFU livestock board chairman Charles Sercombe said the code was a welcome step in the right direction.

“What is critical to our members is the stability this code should bring, which will allow producers to plan ahead and market their cattle without sudden or unexpected changes to conditions of sale,” he said.

Both the NFU and BMPA are calling on all abattoirs to sign up to the voluntary code, as well as retailers, food service companies and renders who could also operate according to its principles.

So far six processors have signed up: ABP, Dovecote Park, Kepak Group, Randall Parker Foods, 2 Sister Food Group and Morrisons subsidiary Woodheads.

But Dunbia and Dawn Meats – two of the largest – have not signed up. 

BMPA president Peter Mitchell said “responsible and forward-thinking processors” had to be open about terms and conditions of trading.

“Signing up to the code is a visible sign of this recognition and a commitment to constructive relations with beef producers in order to improve the efficiency of the beef supply chain and so together we can better meet the needs of the marketplace,” he said.

Defra farm minister George Eustice hailed the BMPA-NFU discussion that led to the code and he encouraged processors and the rest of the supply chain to get behind the guidelines.