Ottawa-After three years of discussion and drama, all the key players in the proposed Grocery Code of Conduct are onside and it should be in operation by next June.

The Code’s development was proposed by the federal and provincial agriculture ministers in 2021 to improve transparency, predictability and respect in the food supplier-retailer relationship. Agriculture Minister Lawrence MacAulay got to tell this year’s annual ministers’ meeting that Loblaw, Sobeys, and Metro, and most recently, Walmart and Costco, had agreed to participate in the Code. “This significant development marks a major milestone in the ongoing efforts to ensure transparency and fair dealing practices between suppliers and retailers in Canada.”

The Code “is a positive step towards bringing more fairness, transparency, and predictability to Canada’s grocery supply chain and for consumers. We thank the Grocery Sector Code of Conduct Interim Board for their tireless work,” the ministers said in a statement.

The federal and provincial governments will provide $1.2 million in funding to the Office of the Grocery Sector Code of Conduct (OGSCC) that will implement the Code. Its development was pursued by a steering committee, comprising small, medium, and large enterprises—including retailers, manufacturers, distributors, wholesalers, processors, and producers with the goal of establishing a more fair and equitable system within the grocery sector.

Marcus Janzen, President of Fruit and Vegetable Growers of Canada, said the commitment of all grocers to the Code “is a testament to the progress we've made in advocating for a fairer system. We are very pleased that all major retailers have now come together to support this initiative."

The Code is crucial for ensuring growers receive fair compensation for their work, enabling them to continue producing high-quality, nutritious produce for Canadians, he said. “This initiative is designed to enhance efficiency, maintain competitive prices for consumers, and address issues such as payment terms and contract fairness.”

Ron Lemaire, President of the Canadian Produce Marketing Association, said the Code “will support industry’s efforts in strengthening our country’s food supply chain and CPMA is looking forward to working with all stakeholders to implement it swiftly.” It is a set of principles that allow all parties to make informed business decisions, contribute to a thriving and competitive grocery industry, promote reciprocal trust and collaboration amongst grocery value chain partners, and provide an effective, equitable mechanism for resolving commercial disputes.

Michael Graydon, CEO of Food, Health and Grocery Products of Canada, and Chair of the Grocery Sector Code of Conduct Interim Board of Directors, said the agreement on the Code “helps support economic certainty for suppliers. This is crucial as it allows them to invest more confidently in areas like product innovation, sustainability initiatives, and packaging improvements. These advancements not only benefit the suppliers but also enhance the overall consumer experience.

“This unified approach within the industry demonstrates a strong commitment to maintaining a fair and equitable market without the need for government intervention. FHCP is optimistic about the positive changes this will bring. It's about building a stronger, more resilient grocery sector that benefits everyone from suppliers to consumers. We're excited to see the industry come together in this way and look forward to the continued collaboration that will drive innovation and sustainability in the Canadian food industry.

Gary Sands, Senior Vice-President of the Canadian Federation of Independent Grocers, which was the first association to call for a Code, said reaching it was not an easy journey “but achieving meaningful change in any endeavour is never an easy process. This is a complex industry, yet one with a supply chain that is interconnected and interdependent. That is why distorted market practices, that had disrupted our industry over the last few years, needed to be corrected.”

The Code “offers our industry the opportunity to move forward in a renewed spirit of co-operation and healthy competition. CFIG believes we should not spend time looking in the rear-view mirror as to what has transpired in the past, but instead, we must now focus on the road ahead and working together to make the Code effective.”

There is still much work to be done before the Code becomes effective in June of 2025. The hiring of an adjudicator, developing an Industry Guidance document, establishing membership fees and crafting educational and information materials so that all stakeholders have a good understanding of the Code, its principles and the adjudication process.

This news item prepared for National Newswatch.