As we embrace the biggest annual increase in the price of food for decades, it would be a mistake to blame the war in Ukraine, Brexit or global supply shortages. The underlying issue is the price control that has kept the cost of our food lower than the rest of Europe for far too long.
There are a few factors at play. Firstly, supermarkets, driven by market share gains, have strived to offer the cheapest deals so they can both retain and attract footfall, passing on the cost baton to suppliers. Secondly, we have never escaped the shackles of post-WWII imports, which include GMO modified grain from the US, and the subsequent farming subsidies agreed by our government when we joined the European community.
As a result, consumers have got used to a low price that has come at great cost to our farming communities. Many farms operating in the red while a disproportionately larger share of value in the supply chain goes to the big retailers.
The food system is all but broken, and only really works for a handful of retailers and multinationals who have no real competition. If we are to support a growing population for the next 50 years, we need to initiate a food value reset that supports growers and manufacturers. We must recognise the contribution they may make to not just our economy but to our resilience during times of crisis.
There’s also the link between the food we eat and our health. This was the foundation of Henry Dimbleby’s National Food Strategy, but it didn’t go deep enough. If we can ‘in-house’ more of our food supply ecosystem, we will increase resilience against global crises, reduce the pressure on our health services and make our rural industries a valuable part of our economy.
Today agri-food contributes £120bn a year to the UK economy. Agriculture is around 10% of this figure, employing more than four million people. With government support, this could grow and become a self-serving investment, creating value for the economy, sustainable employment and a proper approach to long-term stewardship of the rural environment.
With a clear target for self-sufficiency that is fixed politically, we can achieve a better and more measurable output for British farming, giving the sector confidence to invest in sustainability and ensuring we are properly addressing the issue of food security exposed by the war in Ukraine.
Since Brexit, much has been done to showcase local producers. We herald a new era for food in the UK with provenance, taste and health at its heart, with a clearer line between the rural economy and social governance. ESG cannot all be about the environment.
Despite substantial cost pressures bearing down on retailers and supply chains, supporting fair pricing for food producers should be at the heart of their governance goals, because it is the seed for affordable, safe food and a resilient supply chain in the future. If farmers cannot thrive because they are struggling to survive, then they also cannot operate more sustainably, which impacts our net zero ambitions.
We must value the contribution our rural economies play if we are to meet our goals for a not just a growing economy, but one that is sustainable too.
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