Copa and Cogeca welcome calls for EU legislation to be introduced to tackle unfair trading practices in the food chain

Copa and Cogeca welcomed today recommendations made by the EU Agri Markets Task Force, especially calls for EU legislation to be introduced to combat unfair trading practices (UTPs) in the food chain to bring back fair returns for producers.

The task force was set  up to look at solutions to the extreme volatility existing on EU agricultural markets and to help secure a more viable future for farmers and their cooperatives.

Reacting to the Task Force report, Copa & Cogeca Secretary-General Pekka Pesonen said “We welcome the main recommendations of the group chaired by Cees Veerman. In particular, we welcome the recommendation for EU legislation to help fight UTPs in the food chain. For us, an EU framework law is vital to curb UTPs – something we have long been calling for – so that operators are sanctioned when they break EU law. An independent third party ombudsman must impose sanctions whenever there is non-compliance.”

“We welcome the recommendation for mandatory written contracts provided that the specific nature of cooperatives and their relations with their members is safeguarded. We also support the initiative to increase market transparency by creating market observatories in the milk, beef and pork sectors but they need to be extended to include other sectors like sheep meat, sugar, wine, cereals and potatoes”, Pesonen added.

“We believe that the basic payment scheme under Pillar I of the CAP is the main income stabilizing tool for farmers and must continue. Direct payments to farmers provide stability and help to secure their cash flow. Farmers need enough tools to manage the different risks they face, be they weather events, pests and diseases or market volatility. Under EU Rural Development Policy – the second Pillar of the CAP – insurance and mutual funds should aim to stabilise the economic viability of the farm without distorting trade and competition between farmers from different Member States. In addition risk management schemes should remain flexible and co-exist alongside state aid and existing national risk management systems. Implementation, in particular for farmers must be voluntary”, he said. He continued “It is important to keep premiums to a low and acceptable level in order to promote the uptake of these measures.

“Finally, we welcome the Task Force recommendations to further develop futures markets. Efficient and well-functioning futures markets help farmers and agri-cooperatives to better manage risk and reduce their reliance on retailers. It is also a positive step that the use of export credit guarantees will be looked at to give exporters more certainty”, Pesonen concluded.

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