New dairy legislation is widely welcomed

AFTER more than a decade of campaigning by farming unions, a new law is now in force to ensue dairy contracts for farmers are fair and transparent.

The Ulster Farmers’ Union (UFU) has welcomed the new legislation, called ‘Fair Dealings Obligations (Milk) 2024 FDOM24), which recently came into force.

New milk contracts from that date must comply with the regulations. Existing milk contracts have a 12-month transition period to July 2025 before they too must meet the new legislation requirements.

Commenting, UFU dairy chair, Cyril Orr, said, “With the other UK farming unions we have put years of work and lobbying into achieving greater fairness for dairy farmers.

“We believe the new regulations will drive transparency and accountability, by stopping the imposition of contract changes without agreement.

“This legislation will not set the price, nor will it introduce minimum prices, but it will bring greater transparency for all farmers.”

Farmers will have the power to challenge contracts via an independent third party, if they feel their milk buyer has not followed the correct process.

The new regulations allow farmer-owned structures, such as co-ops, greater flexibility in negotiations with milk buyers.

Mr Orr added, “The fact that these organisations negotiate on behalf of farmers boosts their bargaining power, putting them in a stronger position than individual farmers.

There is also an enforcement mechanism in the regulation, through the Agricultural Supply Chain Adjudicator.”

The UFU strongly encouraged dairy farmers who are experiencing any issues or who need advice on new or existing contracts to look to the Agricultural Supply Chain Adjudicator guidance online or contact the UFU technical officer team.

Farming unions across the UK have also welcomed the passing of the new legislation.

The National Farmers’ Union (NFU), said it was “a significant step” towards fairness.

“The NFU has long been campaigning for fairer, more transparent contracts to aid trust and collaboration across the supply chain and prevent some of the worse abuses of power which one-sided contract terms allowed,” said chairman Paul Tompkins.

“This means, among other things, it must offer a clear, transparent price or pricing schedule.

“‘A & B’ pricing under an exclusive contract is no longer allowed, and it prevents unilateral changes to a contract.

“If one party disagrees, farmer collaboration is encouraged to support effective negotiation and, importantly, there are now clear consequences should one party be found to be in breach.”