Taxonomy term not found using tid from term reference
First, don't use 'und', you should be using LANGUAGE_NONE instead.

Your code works, so you might have a data inconsistency on your database, are you sure that the term id 7 really exists?

You can use entity api metadata wrappers to access easier to the field information, or if you're not  using Entity API module, the function field_get_items is a better way to access the information.

$user_suppliers = array();
$items = field_get_items('node', $user_selling, 'field_suppliers');

foreach($items as $item) {
    $user_suppliers[] = $item['tid'];
}

$firstsupplier = reset($user_suppliers);
$first_supplier = taxonomy_term_load($firstsupplier);