Farmers have launched a scathing attack on Britain's major supermarkets, accusing them of abusing their power and creating a climate of fear among suppliers.
The NFU said the retail giants were putting the supply chain at risk and claimed it had found examples of malpractice in the current system.
Problems include upfront payments being demanded by retailers from suppliers - sometimes running to millions of pounds - and suppliers being required to pay retailers an annual payment based on a percentage of their turnover.
In its response to the Competitions Commission's investigation of the grocery market, the NFU also found there were no written terms of business in place and retailers frequently changed the verbal terms of business at short notice or in some cases retrospectively, including across the board price cuts.
Suppliers were also required to pay for promotional activity and then having to take a lower price for their product because of the promotion, the NFU report said.
Meurig Raymond, deputy president of the NFU, said the evidence confirmed that most of the issues raised in a previous Competition Commission investigation in 2000 remained unresolved and that the Supermarket Code of Practice had failed.
"There is an obvious and very dangerous imbalance in the supply chain, that the Competition Commission really must get to grips with if serious damage to our food industry is to be avoided," he said.
"It cannot be in the consumers' interest for high quality British food producers to be forced out of business by the abuse of supermarket power.
"We have spoken to many of our members on this issue and no one was prepared to be identified in our submission to the Competition Commission because they feared that they could lose current contracts.
"This demonstrates very clearly to me the level of fear that exists and the dominance that the retailers have in the market place which creates an imbalance of negotiating strength which the retailers can, and do exploit."
William Chase, of Tyrells Crisps in Leominster, Herefordshire stopped selling potatoes to supermarkets and diversified into making crisps for the independent sector.
He said: "Most of the potatoes I grew I supplied to supermarkets, which often left me feeling detached, without any feedback or thanks from my end customers. With the continual price pressure from the supermarkets, I realised I had to change direction.
"Supermarkets can be very toxic, they want cheap food and it is never cheap enough.
"They have to compete to keep profits up and so they give food away for nothing and there is only one person who will have to subsidise that - the farmer. The issue of polytunnels is linked to supermarkets, because it is supermarkets which want the food on the shelves all year around."
Mark Giles, who grows fruit at Array Fruit Farm in Bromsgrove, is one of the few farmers who has spoken out about supermarket power.
He said: "The way they treat growers is diabolical. It doesn't happen in Spain and France and I think the Government just lets them get away with it."
He fears many growers are going out of business because of what he says are the impossible demands placed upon them by retailers and growing competition from abroad.
He claims many who supply the chains would get de-listed if they spoke out against them.
Mr Giles gave up supplying supermarkets 20 years ago and now sells to a local farm shop.
"The demands are horrendous. If the fruit is not there on time the whole lorry can be rejected and you have to then pay to dump it. They will take the best size there is but there is no doubt smaller apples keep better."