Stronger earnings through supply chain cooperation

Collaboration within the food supply chain provides clear benefits for farmers pursuing sustainability. The main advantages are cost savings and security of product sales. This is the outcome of research by the Netherlands Authority for Consumers and Markets (ACM) into the impact of chain cooperation on the earning potential of primary producers.

Better position, limited pricing impact

Sustainable production does not automatically lead to higher prices. Supermarkets and other buyers often hold a dominant position in negotiations, making it difficult for farmers to secure fair compensation. One way to counterbalance this is through forming a Union of Producer Organisations (UPO). By joining forces, producers can improve their bargaining position. However, this concept remains largely unfamiliar and underused in the Netherlands.

Farmers bear most of the risk

Risks linked to sustainable practices—such as crop loss due to restricted use of plant protection products—typically fall on the farmer. While some agreements include compensation or purchase guarantees, these arrangements remain limited. Most risks in practice remain with the farmer. Clear agreements can help establish more balance in the supply chain.

Consistent and transparent government policy is crucial to support sustainability efforts through collaboration. Policy certainty builds trust and creates the foundation for long-term commitments among supply chain partners. This helps to secure joint sustainability efforts over time.

Read article and download report : acm.nl