Chief executive Robert Gooch said many of the contracts ‘aren’t worth the paper they are written on’
The British Free Range Egg Producers Association (BFREPA) has announced it will create a model supply contract for its members to use with packers to ensure fairness and confidence in the sector.
Many contracts were ‘not worth the paper they are written on’, according to BFREPA chief executive Robert Gooch speaking at the organisation’s annual conference.
He asked members to send copies of their contracts so they could be assessed by specialist contract lawyers.
It followed a tough summer when farmgate prices fell due to oversupply while drought conditions increased feed bills by 50 per cent for some producers.
With new entrants building their first sheds and existing businesses expanding, Mr Gooch said it was vital all producers had rock-solid agreements in place.
The contract was aimed to be launched by the end of the year and will a key component will be a clear commitment to egg price for the duration of the contract, or terms linked to the fluctuating price of feed.
The organisation will also examine notice periods and procedures for the transfer of accreditation scheme rights at the end of contract.
“Supply contracts are the foundation of most free range egg businesses but it is alarming to see so many examples with no reference to the price producers will be paid for their product,” Mr Gooch said.
“My members need to know where they stand so they can continue to invest in their businesses to make them more efficient and maintain the excellent standards of hen welfare we see on British free range farms.
“Our vision is that all free range egg businesses have fair, meaningful contracts which guarantee a supply of high quality free range eggs to consumers at a sustainable price for producers.”