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Centre for Food Policy

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Food Systems: Food Policy and Governance perspectives

GECAFS Food Systems workshop

21-22 October 2004

Medical Research Council, London

David Barling

Centre for Food Policy

School of Allied Health Sciences

City University

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Some key themes

• The food system is increasingly complex

• Witnessed a food revolution in last century

• Changing patterns of governance

• Major policy challenges

• Focus esp. on near consumption end

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20th century food revolution

• new products, processes & intensification• new distribution & logistics • Transformation of ‘nature’: rise of genetics• impact on health, environment and culture• pressure on control systems, rise of supply

chain management• Primacy of marketing, brands, price

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Key change factors are…

• Market globalisation: penetration of new food markets

• Technological change in work and leisure

• Urbanization and rising incomes

• Cuts in real food price

• Shopping opportunities - from small stores to supermarkets

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Key change factors (cont.)…

• Concentration, i.e. emergence of national, regional and global giants

• Integrated management control systems

• Global sourcing (now + rhetoric of localism)

• Marketing: systematic moulding of and response to consumer consciousness

• Pursuit of brand value

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… this has shifted power

• from State to Corporation: emergence of dual regulatory structures (State/Corp’n)

• from Farm to Retail + Trade:

• from National to Regional/global: e.g. rise of WTO + Codex/ EFSA

• from Citizenship to Consumerism

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Current State policy focus is on safety…when it ought to be on the (social) features of food policy…• Health: nutrition & degenerative disease

• Environment: causes of pollution, lifestyle, energy use, resource depletion (e.g. water and biodiversity)

• Consumerism: price and cost internalisation

• Culture: people skills

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Challenges

Look at 2 key challenges to the food system with focus on the consumption end:

1. Market power and corporate concentration

2. Nutrition and health

Could add 3. externalities & 4. waste

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Challenge 1: Market Power and corporate concentration

Look at concentration along the food chain especially near consumption end

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European Grocery Turnover

66.948.931.9

189.4

93.7

58.748.5

260.9

131.1

78

72.7

387.8

0

100

200

300

400

500

600

700

billio

ns

2000 2005 2010

Largest 2nd Largest 3rd Largest Next 7 Largest

• Source: IGD Research, 2001• Published in: European Grocery Retailing… now and in the future…, Press Release, February 26th 2001, IGD

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IGD European Retail Index (ERI)Retailer Rank

(ERI)Rank

(Turnover)European Total

Grocery Market ShareEuropean Status

Carrefour 1 1 7.2% Leading pan-EuropeanMetro 2 2 1.9% RetailersAuchan 3 5 2.9% Major European RetailersAldi 4 7 2.9% (not yet pan-European)Lidl & Schwartz 5 14 1.7%Ahold 6 10 2.4%Tesco 7 6 3.3%Rewe 8 4 2.3%ITM 9 3 2.9%Casino 10 15 1.7%Tengelmann 11 12 1.3%Wal-Mart 12 13 1.9%

Total 32.4%• Source: IGD Research; Market shares - IGD Research & estimates/M&M Eurodata; published in: European Grocery Retailing… now and in the future…, February,

2001, IGD

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0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

World's Top 20 Grocery Retailers,by Turnover (2000)

• Source: IGD (2002), Global Retailing• Letchmore Health: Institute of Grocery Retailing, pg 113

14

17

48

0

42

83

0

19

33

1113

19

36 37

2

16

49

39

30

24

0

10

20

30

40

50

60

70

80

90

% F

ore

ign

Sa

les

World's Top 20 Grocery Retailers,by Foreign Sales (2000)

• Source: IGD (2002), Global Retailing; Letchmore Health: Institute of Grocery Retailing, pg 113

15source: J Grievink Cap Gemini / OECD 2003

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Top 10 global food processors, 2001, $bnTop 10 global food processors, 2001, $bn

7.0

9.0

9.9

10.6

12.2

12.8

19.0

30.5

35.1

41.8

0 10 20 30 40 50

Kellogg

Heinz

Danone

Sara Lee

PepsiCo

General Mills

ConAgra

Unilever

Kraft

Nestlé

In 2001 General Mills bought Pillsbury from

Diageo

Source - Company Annual Reports, 2000

$Bn

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Growth of McDonalds' Total System-wide Restaurants and Total System-wide Sales, 1991-2001

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

2001 2000 199919981997199619951994199319921991

$-

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

mill

ion

US$

Total Systemwide restaurants

Total Systemwide sales

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Yum! International Sales in International Restaurants, 2001 (KFC, Pizza Hut,Taco Bell)

source: company website 2002

Americas21%

Greater China11%

Asia Pacific43%

Europe - South Africa25%

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World’s top 7 agrochemical companies 2001 source: Agrow 2002

 

Rank Co. AgChem Sales $m

1 Syngenta 5,3852 Aventis 3,8423 Monsanto 3,7554 BASF 3,1055 Dow 2,6126 Bayer 2,4187 DuPont 1,917

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Challenge 2: Nutrition and Health

• Nutrition Transition: dietary change health impact

• Health policy: degenerative diseases deserve higher priority than safety

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Major dietary changes: the nutrition transition

• Rise of meat, sugar, refined foods

• Drop in fibre, & often in fruit & veg

• Change in tastes

• Change in production and food systems

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Injuries (9.1%)

Noncommunicableconditions (59.0%)

Communicable diseases,

maternal and perinatal

conditions and nutritional deficiencies

(31.9%)

Total deaths: 55,694,000

Source: WHO, World Health Report 2001

Death, by broad cause group 2000

23

49%

27%

9%

15%

22% 43%

14%

21%

Global burden of disease 1990 - 2020by disease group in developing

countries

Communicable diseases, maternal and perinatalconditions andnutritional deficiencies

Noncommunicable conditions

Neuropsychiatric disorders

Injuries

1990 2020 (baseline scenario)

Source: WHO, Evidence, Information and Policy, 2000

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Deaths, by broad cause group and WHO Region, 2000

InjuriesNoncommunicableconditions

Communicable diseases, maternal and perinatal conditions and nutritional deficiencies

AFR EMR EURSEAR WPR AMR

25

50

75%

So

urc

e:

WH

O,

Wo

rld H

ea

lth R

ep

ort

20

01

25

0

50,000

100,000

150,000

200,000

2000 2020 2000 2020

India SSA

Double burden of disease in Double burden of disease in middle/low income countriesmiddle/low income countries

DALYs

Communicable, maternal/perinatal cond.,nutr. deficienciesNoncommunicable Conditions

Source: WHO/EIP Global Burden of Disease

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Diet and risk of NCD• Up to 80 % of cases of CHD and up to 90 % of

type 2 diabetes could be avoided through changing lifestyle factors.

• About one third of cancers could be prevented by eating healthily, maintaining normal weight and being physically active throughout the life span.

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What institutional response?…emergence of multi-level

governance • Global

• Regional

• National

• Sub-national

• Local

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Governance: Public & Private

• Dual system : Public and Private• Private sector leads in some cases• Public leads in others: reacts to crises?• Hybrid – e.g. post Curry Commission on

Future of Food and Farming – new supply chain management (role of the Food Chain Centre & Farm Assured Standards)

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Food policy lacks integration

Polices are divided across:

• Health

• Food safety

• Agriculture

• Trade

• Competition

• etc

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More integrated approaches exist

• WHO European Region (51 member states):

First Action Plan for Food & Nutrition Action Plan 2000-20005

• WHO Global Strategy on Diet, Physical Activity and Health (2004)

• Lacking policy authority - left to member state action

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Conclusions

• Complex changes result in policy challenges and huge costs

• Selective presentation to focus on near consumption perspectives

• Global environmental changes further complicate these challenges (&costs)

• Ask are OUR food systems’ typologies robust enough to address these changes?