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How supermarkets kill sustainable food

Supermarket local sourcing initiatives: Moving us further away from a sustainable, local food economy

Our food system is controlled by a handful of multinational corporations. The supply of food is a global business. However, a more localised, food system still exists. There are real benefits to a true local food economy. However, supermarkets see local food as an 'expanding market' to be exploited. In 'Supermarket local sourcing initiatives: Moving us further away from a sustainable, local food economy' Kathryn Tulip examines what supermarkets really mean by 'local' food and whether the 'local' products on supermarket shelves signify a real change in the food supply chain or simply a shift to ripping off local producers as well as distant ones.

Introduction

Provenance (where foods come from) sounds sexy. Think Cornish clotted cream, Scottish raspberries, all the rage on the menus of fancy restaurants and in supermarket advertising in the Sunday supplements. But declaring provenance doesn’t equate to saying it's locally produced: You can buy, for example, Cornish clotted cream in Scotland and Hereford beef in London. Provenance is also somewhat one-dimensional; it describes the physical place of production but does not provide the broader economic, environmental and social aspects and benefits attributable to local food.

'The typical supermarket contains no fewer than 30,000 items. About half of those items are produced by 10 multinational food and beverage companies. And roughly 140 people — 117 men and 21 women — form the boards of directors of those 10 companies. In other words, although the plethora of products you see at a typical supermarket gives the appearance of abundant choice, much of the variety is more a matter of packaging and branding than of true agricultural variety, and rather than coming to us from thousands of different farmers producing different local varieties, has been globally standardized and selected for maximum profit.' - Frances Moore Lappé and Anna Lappé in 'Hope's Edge' [1]

The Soil Association says that local food is "food arising from a system of producing, processing and trading, primarily organic and sustainable forms of food production, where the physical and economic activity is largely contained within and controlled within the locality or the region where it was produced, which delivers health, economic, environmental and social benefits to the people in those areas." [2]
Whilst supermarkets are very keen on provenance and have created a variety of 'local' sourcing initiatives, in reality the genuine local food sector is in danger of being co-opted by the big food retailers...

Corporate control of the food system

The ownership of the food system has changed. The global food system is now controlled by a small number of very powerful multinational food corporations. Over the past 20 years, there has been a frenzy of corporate takeovers as food corporations fought with each other to increase their share (and hence their profits) in the food market. The result is an incredible concentration of market power, with just three or four corporations controlling each sector of the food industry. From inputs like seeds, increasingly dominated , fertilisers and machinery to the processing, transportation and retailing of food, each sector is now controlled by a handful of multinational agribusiness/food corporations. From Monsanto and Syngenta to Unilever and Diageo to Tesco and Asda.

The rise of supermarkets

Perhaps the most dramatic development and most obvious sign of the concentration of market power in the food system in the UK has been the emergence of the big supermarkets. Fifty years ago, food was mainly sold in street markets or in small independent shops: butchers, grocers, bakers and greengrocers that filled every high street. In 1960, small independent retailers had a 60% share of the food retail market. By 2000, their share was reduced to 6%, while the supermarkets' share had increased to 88%.[4]

Now most of us buy well-known food brands (from multinational food corporations like Nestle, Kraft and Kelloggs) in one of four big supermarket chains (Tesco, Asda, Sainsburys and Morrisons). These four supermarkets control over 80% of UK food sales, and it’s set to get worse. The big supermarkets are still battling it out to see who can become top dog, but Tesco is currently the clear leader of the pack, with a massive 30% share of UK food sales [5]. A report from the All Party Parliamentary Small Shops Group has predicted that, at current rates of closure, there will be no independent retailers left in the UK by 2015.
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Historically, small independent stores have been a major outlet for food from local sources. In rural areas, where supermarkets have not yet gained a stranglehold, remnants of this local food sector still exist. A 1997 survey of small independent food shops in rural East Suffolk found 81 shops sourcing food from almost 300 local and regional producers, and some of them had been supplying produce locally for more than 30 years. [7] By contrast, the essence of the supermarkets' success is based on centralised systems of purchasing and delivery and category management systems, which they say keep down transaction costs, help them achieve the necessary volume and year-round supply of food, and control and manage food quality and safety. Only large national or global suppliers can provide the quantities and consistency of supply demanded by these centralised purchasing policies. In practice, this means that the supermarket chains tend to deal with a small number of larger suppliers. For example, Sainsbury buys conventional carrots for all its stores from just three large growers. As Patrick Holden says, "Category management leads to migration towards economies of scale and away from local." [8] Supermarket purchasing and category management policies are effectively the antithesis of local sourcing.

What does the real local food sector look like?

Despite this massive shift in food retailing from small independent stores to big supermarkets, there is still a thriving local food economy that is growing, albeit very slowly. Though local retailers remain an important route to market for local foods, as a result of the decline in local retail outlets, direct sales from producer to consumer have grown in size. Farmers’ markets, farm shops, box schemes and sales direct from the farm gate are now the most common routes for local food supply. According to a study of the local food sector by the Department for Environment, Farming and Rural Affairs (DEFRA), the majority of local food enterprises are micro-businesses, many of them driven by dynamic, energetic individuals who are committed to the local food sector. The majority of enterprises are relatively young, many are producers or growers who have diversified and sought to add value to their products.[9] However, there are still remnants of an older local food sector, which pre-dates the rise of supermarket retailing and reflects a period when local shops were the main route for food purchase.[10]

The Benefits of Local Food
Environmental benefits:

Sustainable production methods - The majority of farmers who sell at farmers’ markets use more environmentally friendly farming systems or they farm organically.[11]
Reduced transportation - Trucks moving food account for 25% of all road freight in the United Kingdom. Food transportation within the UK (cars, trains, trucks) creates almost 2% of total UK greenhouse gas emissions. Fresh fruit and vegetables go off quickly – so those that travel long distances usually travel by air, the most environmentally damaging form of transport (11% of greenhouse gas emissions is food transport-related[12]).Car miles associated with grocery shopping increased by over a third between 1992 and 2002, reflecting growing affluence, car ownership and the increase in bulk grocery shopping at out-of-town supermarkets. Relocalising food production and distribution systems will reduce the food system's contribution to these climate-affecting greenhouse gas emissions.

Social/Cultural Benefits:

Food security - Our food and farming system needs to become increasingly resilient as we face peak oil, the impacts of climate change both on our ability to farm (droughts and flooding) and on the consequence of using ever more fossil fuels. There will be increasing competition for land due to agrofuel production and the possibility of resource wars, whether for land, oil, water or seeds. We need to be ready to face these with a locally appropriate and diverse farming system that is capable of supplying the majority of our food needs locally. Otherwise we face the prospect of increasing food injustice between those who have access to food and those who do not.
Direct connections between farmers and consumers - Local food fosters greater trust and connection between farmers and those who eat the food they produce than long-distance food, where there is no obvious connection back to the farm.
Food culture and diversity - Local food can reconnect us with where our food comes from. Many of us have lost our connection with the land and the seasons, and have little or no awareness of when, where or how various foods are produced. The quest for easily transportable, cosmetically attractive, and broadly acceptable produce has favoured the cultivation of uniform varieties, and the production of uniform foodstuffs over the more locally distinct, quirky and genetically diverse varieties that prevailed as part of former farming practices and food traditions and are integral to our culture and landscape. Food that has travelled long distances erodes seasonal and local distinctiveness in favour of uniformity.
Freshness, flavour and variety - Local produce is likely to be fresher, more flavoursome and more varied. Long-distance fruit and vegetable varieties tend to be chosen for their yield and keeping qualities, not for flavour, diversity or nutritional value. Many are harvested before they are ripe and stored for long periods before distribution losing freshness, flavour and nutritional content.

Economic Benefits:

Creating jobs and job security - Diversification of processing and direct supply or retailing of local produce has been critical to the survival of many farm businesses. They get a fairer share of the 'food pound' as they deal directly with the public, receiving fair prices for their produce. Farm businesses involved in the local food sector employ a greater number of people than the conventional agriculture sector. A survey of 70 small food businesses in the south west of England showed that 38% had created new jobs in the previous year (an average increase of 0.5 full-time employees for each business).[13] Long-distance food sold through supermarkets does not reward producers with fair prices for their produce. Instead, we pay for the costs of transport, refrigeration and packaging.
Improving local economies - Money spent on local produce at farmers’ markets and locally owned shops stays in the community, cycling through to create jobs, raise incomes, and support farmers and, indirectly, other local businesses (the multiplier effect).[14] Long-distance food sold in supermarkets siphons away profits to company shareholders; very little is reinvested in the local economy.

Fitting a square peg in a round hole: Local sourcing and supermarket centralised distribution systems

Despite their rhetoric, the supermarkets continue to use their centralised distribution methods to source food from their 'local' suppliers, making it impossible for them to deliver on the environmental benefits of local food. Soil Association head and organic farmer, Patrick Holden (and also Prince Charles' Highgrove Farm) fell victim to a supermarket's idea of what constitutes local food when he was required to truck his carrots over long distances to comply with Sainsbury's packing and processing requirements. After his local packer closed down, Holden was forced by Sainsbury's to truck his carrots 230 miles to their superpacker in East Anglia. The carrots were then delivered to a regional distribution centre in another part of Wales, and then back to mid Wales to be sold as ‘local’. The carrots were still marketed in Sainsbury’s stores in bags that told the story of Holden's family farm in Wales. However, the story of their journey from field to supermarket shelf was anything but local and masked an alarming carbon footprint. [26]

According to Richard Wild, who runs a haulage company and works for the big supermarkets, including Tesco, the supermarkets want 'local' produce packed in their own packhouses, which means the produce may travel many miles to the packhouse and then be delivered back to stores local to where the produce was grown and sporting a label saying they are 'local'. He says "the truck leaves (the) packing station at one end of country, collects from a field where produce is harvested, trucked another 200 miles back to the packing station, then another 200 miles by fridge truck to the supermarket distribution centre. Total finished product food mile trip say 600 food miles."[27]

As Patrick Holden put it, "while all supermarkets are preaching localism, most of what they actually do is just tokenism. Their systems are still going in the opposite direction."[28] And perhaps that's not too surprising. The current structure of supermarket transportation and delivery systems makes it unlikely they will deliver on their rhetoric of local food. As Tim Lang, professor of food policy at City University, London, said, "They are locked in to a trucking and packing system that they have invested millions in over the last 30 years. They would have to reinvest dramatically - moving from a few regional distribution centres to hundreds of more local ones - to become really local."[29] And it looks like at least some of the supermarkets are becoming more centralised in their distribution systems, not less.
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Ripping off local farmers instead of distant ones?

Supermarkets have a very poor record when it comes to the treatment of their suppliers, especially small suppliers who have considerably less bargaining power in their relationships with the big supermarkets.[35] Meeting the technical and quality standards demanded by the supermarkets is a significant barrier to small producers.
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Invigorating local economies?

One of the benefits of local food is that it helps maintain a strong local economy. The same amount of money is worth more when all the transactions stay local, and its value is multiplied as it is reinvested many times over. This is often referred to as the multiplier effect. Supermarket local sourcing provides part of this equation. Some money goes to the local supplier, but supermarkets whisk away their profits rather than reinvesting them in the community, as a local shop is likely to do. A local retailer would probably use a local printing shop or firm of solicitors, whereas a major supermarket will use national services contracted centrally. One study suggests that less than 16% of supermarket turnover translates into local wages, purchases and services.[38]
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Supermarket local: Moving us further away from a sustainable local food economy

"Local food economies are our best hope for checking the drift toward the total global economy.'" - Michael Pollan in Beyond the Bar Code: The Local Food Revolution

There seem to be conflicting views of how the local food sector might develop: Is it a sector which delivers ‘added value’ and speciality foods to a niche market, or a sector that enables all communities to access fresh, local food and support their local economy?

In a FSA survey of shoppers, the top two reasons for buying local were "supporting local businesses" (57%) and "supporting the local area and/or community" (51%). Other motivations included issues surrounding food quality, such as knowing where the producers were (18%), and 'fresher food' (11%); 'environmental factors', such as causing less air miles (12%) and less pollution (9%). [42]

In contrast, supermarket local sourcing is nothing to do with altruism. Asda has calculated that there is a £160m per annum sales opportunity in selling local products.[43] Indeed, supermarkets are reporting ever-increasing profits from the local food market.[44] Supermarkets are not wedded to the idea of local sourcing, except as a money spinner: put a few local and regional pickles and jams in stores (niche marketing of added value goods) and call it a 'local' sourcing policy. They have no intention of making the wholesale switch from global/national sourcing to sourcing all types of goods, for all consumers, locally.

"There are many social enterprises, businesses, manufacturers and caterers who are making efforts to use genuinely local and seasonal food. Their efforts are being undermined by the growing use of terms such as 'local' and 'seasonal' to market foods, often promoted with evocative imagery of local production, that do not comply with these ethical and environmental credentials. These terms are being used in ways that could be highly misleading to consumers." Ethical Hijack [45]

"There is some possibility that in spite of all of this, they would make substantial moves towards stocking more local food if enough people pressured them, but this leaves all the other problems with supermarkets untouched. What will we have achieved if supermarkets just switch to ripping off local farmers instead of distant ones? How will stocking local food make supermarket jobs more rewarding? How will it bring back the independent stores which have been put out of business, or ensure that money stays in the local community? The simple answer is that it will not. Supermarkets are as inexcusable as ever."[46]
It’s hard not to conclude that supermarkets’ local food sourcing strategies are just another victim of their desire to make a fast buck and boost their Corporate Social Responsibility rhetoric. As the blurb for the 2008 Responsible Retailing Summit says, "This event focuses on how UK retail executives can develop corporate social responsibility (CSR) strategies that will boost profits, reduce costs, increase market share and enhance their retail brands."[47] Not a word about the environment or local economies and communities. It’s business as usual, then, at the supermarket.

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Full article with references: http://www.corporatewatch.org/?lid=3718