New work from Portsmouth University and the University of London, in association with food and farming alliance Sustain, has revealed unsustainably low returns at farm level.
According to the report: Unpicking Food Prices: Where does your food pound go and why do farmers get so little? UK farmers are often left with far less than 1p profit from the food items they produce. For example, fruit producers end up making just 3p from each kilo of apples. The charity is calling on government to beef up supply chain regulations making them fairer for farmers, for regional structural funds to invest in more infrastructure like hubs and local processing that could shorten chains, getting more value to the farmers, and for more transparency in food chains
Vicki Hird, Head of Farming at Sustain said, “It is astonishing how little of the money we pay for our food ends up in the hands of the farmers and growers. Farmers carry a lot of risk and work in difficult conditions to put food on our table. We also expect them to look after our landscape and our nature – and want them to do more of that in the future including protecting nature and helping to cut 30% of food-based climate changing greenhouse gas emissions. If they are to do that, they need more money in their businesses. That money should not leach out of the system into the coffers of food industry intermediaries and supermarkets.
“If we’re to give our farmers the chance to change how we produce food, they need to keep more of the value so they can invest and use new approaches. We should not let intermediaries and food buyers hold all the bargaining chips. Crucially, our report shows that paying farmers more need not mean higher food prices so retailers cannot use that excuse – there would be little impact on many products’ retail prices if farmers were paid more.”
The report found that for 1kg of apples purchased in a supermarket (about 6 apples), the apple grower has costs of 76p, yet receives in profit just 1% (3 pence) of a selling price of £2.20. From a non-profit hub, 1kg of organic apples purchased gives the organic apple grower three times -3% (10 pence) of the selling price of £4.00 with costs of 175p.
For 1kg of supermarket carrots the grower has costs of 14p, yet receives negligible profit on a selling price, with prices so low that margins across the carrot supply chain are tiny. When purchased in a not-for-profit food hub, the carrot grower receives in profit 3% (5 pence) i.e., a higher and more realistic return for the higher costs of organic growing and a better proposition for the growers.