PRODUCERS MUST focus on market and consumer requirements not just farmgate prices, advised DEFRA minister Lord Whitty.
Speaking at a Spotlight on Profit forum he said low milk prices were due to many influences from the exchange rate to world markets, to the domestic supply structure.
“Producers need to capture a greater share of the added value by processing and with greater co-operation and collaboration in the food chain.”
Lord Whitty said the Office of Fair Trading was satisfied that there is no monopoly in the retail sector, but a fair range of competition. “Retailers in general are not acting against public interest.”
He added that while OFT is no longer a government body, there are aspects which need further investigation, particularly in the way supermarkets deal with some suppliers. The code of practice clearly hasn’t worked.
“There isn’t one firm dominating the market, but there are some abuses,” he said.
He reckons producers and processors could strengthen their position by greater collaboration and match the power of the supermarkets.
“I have sympathy with the relationship between producers and retailers but some of it is within your own hands. Some requires OFT investigation.
“No processor seems prepared to put their head above the parapet and make a complaint. We need to find a system where they can do that.”