New chicken group set up in Scotland
A newly formed producer group – the Scottish Chicken Growers Association – is meeting with the 2 Sisters Food Group, 2 Agriculture and NFU Scotland on Wednesday (11 December) to discuss a proposal for it to channel the supply of chicken to the Letham and Coupar Angus factories.
The group has been established with the support of the Scottish Agricultural Organisation Society (SAOS), following the recent decision by 2 Sisters to put all contract growers on notice and secure all future supplies for its factories via 2 Agriculture.
NFU Scotland president Nigel Miller said the new group recognised the cost challenges to operating in Scotland, where wheat prices and haulage costs are higher.
“The group therefore wishes to open up dialogue with 2 Sisters which would see supply channelled through the producer group to ensure birds could be delivered to the factory at a fair market price.
“This proposal can allow the chicken sector in Scotland to turn the corner and maintain the geographic spread of production while delivering a quality produce at a competitive price for processing.”
Mr Miller added that the union had held talks with major retailers, who had made it clear there was demand for fresh Scottish chicken and for some specialist free-range and organic birds.
“There is potential to grow the required volumes to as many as 1.4 million birds a week if total Scottish consumption was supplied by home producers,” he said.
“The present survival plan from 2 Sisters may see less than half of that production contributed from Scotland’s farms and processing plants. There is clear potential to rebuild volumes in Scotland.”
LEGAL ISSUES
At an earlier meeting this week, NFU Scotland’s corporate lawyers from Gillespie MacAndrew gave advice to the businesses that have had their contracts terminated by 2 Sisters with immediate effect.
“NFU Scotland understands all independent chicken growers could potentially lose their contracts – some immediately, some after two crops, and others on old Grampian contracts after 12 crops,” said a statement.
“Those businesses that have had contracts terminated have been subjected to a reduction in prices and some have faced unilateral changes in contracts.
“Producers have real concerns about the unilateral reduction in price that will make any future crops of birds unviable if not reversed. That is something we will pick up directly with 2 Sisters and 2 Agri.”