David Chadwick is calling for farmers to get a fairer deal within the agricultural supply chain.

The Brecon, Radnor and Cwm Tawe MP said in Westminster Hall that his fellow MP, Sir John Hayes, was right to describe the supermarkets as an “economic tyranny”.

He said Liberal Democrats are also concerned about concentrations of power, and there is currently no greater concentration of power in the food chain than that held by the supermarkets.

Mr Chadwick said: “Welsh farmers face pressures on all fronts. 19 per cent of British sheep are in Powys.

“However, despite the current bout of food inflation, farm incomes are still falling.

“One of the biggest challenges is the simple fight for fair treatment within the agricultural supply chain.

“Farmers deserve to be treated fairly, which is why the Liberal Democrats championed, during the coalition years, the creation of the Groceries Code Adjudicator (GCA) to tackle unacceptable practices by supermarkets that, time and again, used their size and power to squeeze local producers.

“The GCA has helped to improve the situation since its launch in 2014. But farmers are still coming forward with stories of unfair treatment such as last-minute order changes, delayed payments and punitive delisting.

“These are David versus Goliath situations in which small producers are left shouldering huge losses, while the big retailers rack up billions in profits.

“Just last year, Tesco posted £2.3 billion in profit, while Asda brought in more than £1 billion. But many farmers, particularly in Wales, are barely breaking even.

“Studies back this up. Nearly half of UK farms fear they could go out of business, and three-quarters say that supermarket behaviour is a major concern.”

Mr Chadwick said the GCA needs more teeth, and must be able to launch its own investigations rather than waiting for complaints.

He told MPs: “Too many farmers are scared to come forward, as they are worried about being blacklisted or dropped. The GCA’s scope also needs to be widened.

“Many food suppliers, such as processors and packagers, are not covered, despite playing significant roles in the supply chain.

“Retailers such as Amazon were added only recently, and Amazon scores extremely low on compliance.

“With an increasing market share of smaller, online and non-traditional grocery retailers, many of which do not come close to hitting the £1 billion a year turnover threshold to be covered by the GCA, major players are falling through the cracks.”

Mr Chadwick said better funding, more staff, greater transparency and anonymous reporting tools would all make the GCA more effective.

He said: “It has achieved real progress in the last decade. But if we want to protect our farmers, our food supply and the rural communities they support, the GCA must be given the power, the scope and the resources to help secure a fairer agricultural supply chain.”

The debate follows a meeting last month between Mr Chadwick and the Farmers’ Union of Wales to discuss the need for fairer prices and stronger protections for food producers.