Three of the UK's largest farmer buying groups have formed a a new alliance to deliver better value to their 6,000 members.
Fram Farmers, Woldmarsh Producers and AF Group have announced a new collaborative procurement initiative - Agri Procurement Alliance (APA).
APA aims to secure better value to the farmer and landowner memberships of the three largest co-operative buying groups.
The three groups said this would be achieved by "leveraging the strength and influence" of their combined 6,000 members.
They said the new initiative would "improve margins for their members and build stronger relationships with the supply chain".
The three groups said the establishment of APA was not the beginning of them merging, nor would it dilute their individual independence, identity, or regional propositions.
Each of the groups, as shareholders, will hold an equal proportion of the equity of APA, with two directors representing each of the shareholders on the board of the new alliance.
Stuart McKenzie, APA chairman, said "profound changes" were taking place in the agricultural supply sector as the industry adjusted to a post-Brexit marketplace.
These changes brought "opportunities, challenges and new priorities for farm procurement," the former Woldmarsh Producers chief executive said.
“It has therefore never been more important for farmers to adapt to this disruption, and work together through their cooperative buying groups.
"APA is a response to these challenges and the continuing consolidation of the agri supply chain, including manufacture and distribution.”
The groups said APA would set strategy for the purchase of specific products, utilising the collective strength of the new alliance to build stronger relationships with the supply chain.
Initially, APA will be focused exclusively on the fertiliser market - negotiating procurement terms, collation of market intelligence and new product innovation, and sharing this with the three buying groups.
Mr McKenzie added that despite significant individual growth in membership numbers, cooperation between the groups provided an opportunity to make a step-change in size, bringing the total to over 6,000 members.
"We are confident this will elevate discussions with suppliers to another level, bringing benefits to both members and suppliers," he said.
“APA will be solely focused on working with suppliers, to optimise volumes and deliver more efficient forecasting, planning and enhanced procurement.
"There will be no change in how the individual buying groups support and serve their members, who will continue to receive distinctive value, service and advice.”
