Free-range chicken production in Scotland has been dealt a blow with a new cull of grower contracts by 2 Sisters Food Group, the country’s dominant processor.

Less than three months after assuring the industry that stability had been reached and the future of the sector looked good, the company this week terminated four contracts with free-range producers in the north-east of Scotland, hot on the heels of four others last month. A year ago there were 28 independent chicken growers in Scotland. That has now fallen to 16, with 12 of them supplying Hook 2 Sisters.

Chicken production will fall by an estimated seven million birds a year, which will have affect the feed grain sector of an estimated 35,000t. And NFU Scotland has warned that the production of 1.3 million free-range birds in Scotland will come to an end by the end of September unless there is a significant turnaround in sourcing policy and the creation of new processing facilities.

The Scottish government had been working with Hook 2 Sisters on a poultry plan that included the building of a new cutting plant at their Coupar Angus factory. NFUS president Nigel Miller said that process appeared to have stalled at both company and government level.

“It is now vital we breathe new life into this process,” he said. “Failure to do so will see Scotland’s ambitions to be a significant chicken-producing nation not only slip away, but we may be left with little, if any, chicken production.

“2 Sisters must now be entirely open with its growers if anyone is to have confidence and be willing to invest. At the same time, the Scottish government must be proactive in supporting crucial processing capacity.”

Mr Miller added: “At a time when the UK retail poultry market is predicted to grow 26% over the next five years, from £4.6bn to £5.8bn, it is unthinkable that the Scottish industry should miss out on this fantastic opportunity.”

The loss of free-range Scottish producers means many retailers will struggle to sell free-range Scottish chicken in their Scottish stores. NFUS believes Aldi will be left as the only retailer sourcing Scottish free-range chicken, thanks to a deal in June this year with three growers. However, that supply chain may come under threat as the parent stock of day-old chicks supplying these farms is being discontinued.

No one at 2 Sisters was available for comment.