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Who’s got the power? New study confirms imbalances in agricultural supply chains

 

The study Who’s got the power? Tackling imbalances in agricultural supply chainswas released on 18 November in Brussels by the Fair Trade movement. It reveals how the growing integration –and concentration of power- in the supply chain of agricultural products is having a serious effect not only on producers far away from the supermarket shelves, but all along the supply chain, the environment and onto the choices available to consumers. Unfair trading practices (UTPs) appear, and they are not accidental but structural. The study was commissioned by the Fair Trade Advocacy Office, the French Fair Trade Platform (PFCE), Traidcraft and Fairtrade Germany and officially launched in an event in the European Parliament on the same day (see below).

 

PSC event

 

The study identifies common patterns of concentration involving the main elements of the supply chain, the one exerting pressure on the other all the way down to the producers. The more these elements are integrated with one another, the stronger is the pressure exerted onto the next link in the supply chain. In sheer size, the Consumers (7 billion) and the Producers/Farmers (2.5 billion) are by far the most numerous. However, most of the value share of the transaction (up to 86%) stays with Retailers (supermarket chains), Branded products manufacturers, Traders of produce, Processors/Refiners, and Input producers (seeds, fertilizers, etc.). But trying to present the problem as one between consumers on one side, and farmers and workers on the other, is meaningless. The degradation of the trading and living conditions of farmers and workers, whether inside or outside Europe, creates important risks of unavailability and unaffordability of products for consumers in the midterm, reducing their welfare in the end.

 

Addressing concretely the global nature of the problem and its consequences, the study emits no less than 16 practical recommendations to policy-makers, businesses and workers all over the world. The European Union has a clear responsibility to prevent and punish UTPs, considering the superior purchase power of its 550 million inhabitants, as well as the numerous trade agreements it has with produce exporting countries. Transactions do not occur in a legal vacuum but national legislation needs to be adapted to counter the power concentration trend, and it is clear that no solution will be found in isolation, which is why the study includes action proposals to all seven links of the supply chain as well as to multilateral instances such as the Food and Agriculture Organization (FAO).

 

On the campaign side www.fairtrade-advovcacy.org the full versions of the report as well as abstracts can be found in English and French.

The press release about the report is here.

The report was launched on the same day at an event, hosted by MEP Catherine Stihler, in the European Parliament titled “Solutions to tackle imbalances of power in agricultural supply chains”.

The event attracted around 90 participants including members of various European institutions.Eminent speakers underlined the importance of the issue and discussed the suggestions made in the report.

The debate included the following speakers:

  •    Claire Bury, Director of the Directorate E – Service of DG Internal Market and Services of European Commission
  •    Catherine Stihler (S&D, UK), Vice Chair of the European Parliament’s IMCO Committee
  •    Mairead McGuinness (EPP, IE), Vice-President of the European Parliament
  •    Olivier De Schutter, co-chair of the International Panel of Experts on Sustainable Food Systems (IPES-Food), former UN Special Rapporteur on the Right to Food
  •    Sergi Corbalán, Executive Director of the Fair Trade Advocacy Office (FTAO)
  •    Adam Bedford, Copa-Cogeca

After these interventions MEP Stihler invited the audience to join the debate. The last part of the event was filled with interesting questions and lively exchange of views.

The press release about the event is here.

If you want to learn more you can have a look at the Power in Supply Chains Campaign Website

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