Executive Summary
The actual food system is responsible for 23% of global greenhouse gas (GHG) emissions (IPCC 2019:4) and causes more than 80% of global forest destruction (Farràs 2020). These ecosystems are natural carbon offsetting systems and climate ‘stabilizers’ (Ibid.). Despite the current environmental crisis, the new EU Common Agriculture Policy (CAP) does not offer a sustainable solution for the agriculture sector (Boffey 2020). Meanwhile, 17% of adults in the EU suffer severe food insecurity (Laorden 2017). There is evidence that food prices rise during an economic crisis due to food speculation, which increases food insecurity (Horwood 2014). This situation can be exemplified in the 2008 financial crisis or the one emerging from the ongoing Covid-19 outbreak (Petetin 2020, p. 328). Therefore, new food system strategies with policies that guarantee sustainability and food security must be pursued in Europe. The EU must promote food democratic systems, which will increase food security due to shorter supply chains and self-reliant systems. These local systems will create sustainable local markets based on diversified crops, extensive farming and zero-waste.
Situation Brief
In 2015, more than one hundred countries committed to achieve the environmental objectives set in the Paris Agreement (Camanzi 2017, p. 168) to fight against the environmental crisis. These objectives were based on adapting socio-economic systems to climate change effects and to ‘limit the temperature increase to 1.5 degrees above pre-industrial levels’ (UNFCCC 2015). This task must be pursued while ensuring prosperity and the basic needs represented by Maslow’s pyramid: physiological and safety needs. In the EU, 10% of the total GHG emissions originate from the agriculture sector (Camazi 2017, p. 169). Moreover, 33 million people cannot afford a quality meal every second day (EC 2020). Thus, it can be argued that the actual food system is obsolete, as it contributes to climate change and it does not completely mitigate hunger (Kipkoech 2013, p. 235). Climate change and population growth will decrease food accessibility from a neo-Malthusian perspective (Ibid.). Therefore, in order to face this interconnected dilemma, new policies must be implemented with the objective of decreasing GHG emissions in the EU, while ensuring vital food accessibility.
The agriculture system is one of the sectors with the highest shares of GHG in the EU (EEA 2016), with 10% of the EU’s total GHG emissions being the result of manure, livestock, fertilizer, and so on. (Camazi 2017, p. 169). The supply chain of GHG emissions accounts for an extra 1.8%, which is produced from the farming process and its inputs through manufacturing, distribution, refrigeration, retailing, food preparation, and waste disposal (Garnett 2011). Moreover, the new CAP did not reform the food system but will invest 60% of direct payments to farmers with non-existent green conditions attached (Boffey 2020). The social cost that these policies cause are not internalised in the food price (Camazi 2017, p. 169), which rewards intensive farming. This causes a major negative impact on Europe’s biodiversity due to the use of pesticides, pollution, soil deterioration, and other detriments to the environment (FOEE 2019). Therefore, the EU must apply policies that radically transform its agricultural methods and supply chain. The EU food system is based on an international market – a complicated network of agricultural suppliers, food processing industries, wholesale industries, and retailers (Berens 2020, p. 286). Therefore, these policies will affect these actors, consumers and the environment.
In fact, 17% of adults in the EU already suffer from severe food insecurity (Laorden 2017). Naturally, food insecurity is a relevant indicator for this discussion, as it is defined as the ‘situation when people lack secure access to sufficient amounts of safe and nutritious food for normal growth and development and an active and healthy life’ (FAO 2017). People that suffer food insecurity are often found in vulnerable economic and social situations (Hasell 2017). In fact, there is evidence that show that each US $1000 decrease in annual average wages is linked to a 0.62% increase in food insecurity (Loopstra 2016, p. 44). The following table shows this interrelation:
Moreover, food insecurity is also caused by food price fluctuations (CFS 2011). Normally, European citizens access food through supermarkets (Petetin 2020, p. 330), where prices are set by the international market (Roser 2013). Furthermore, the current supply chain is not prepared to adapt quickly to modified demand – both in terms of increased quantities and sourcing the relevant containers (Ibid., p. 331). Consequently, there is high price volatility that affects low-income consumers, who might be unable to afford basic nourishments due to an increase in price. Petetin (2020, p. 331) argues that ‘the lack of capacity for adaptation and change in the food supply chain highlights the relatively weak role of the farmer in food systems, despite the farmer being the one who actually provides the raw agricultural product’. This claim addresses the additional price that each member of the supply chain adds to the product, which increases its final price in the supermarket. Howeve – when analysing the final price of the product – the farmer is the agent with less revenues in the supply chain, despite being the most vital part of it (Gravey 2019). This does not incentivise farmers to use sustainable methods, which often implies higher economical risks. Food speculation can be exemplified in the 2008 financial crisis or the Covid-19 outbreak (Petetin 2020, p. 328). During the former, investors moved their capital into the food sector, as it is a safe market due to the inflexible demand for food (Mittal 2009, p. 6). For instance, wheat prices increased by 46% in 30 days (Ghosh 2008), which caused a strong rise in food insecurity.
Source: World food price index, 1990-2012. Record high prices occurred during the food price crisis followed by another surge in prices since 2010. FAO price index, 2012.Policy Options
The main policies that the EU could apply to this task can be divided into two perspectives: a reform of the food system while applying economic tools to mitigate the side effects of the current policies; or a radical food system transformation into a democratic and self-reliant system.
The EU could reform and maintain the actual food system based on the international market, applying different economic tools that could correct its negative outcomes. In order to mitigate the negative environmental impact, the EU could launch economic incentives prompting producers and consumers to internalise the social costs of pollution (Unnevehr 1999). This policy would be based on a price control approach that would include GHG emission taxes in food prices. This would induce the reduction of the agricultural environmental impact (Luckow 2015). In addition, the GHG tax would influence supply chain emissions as well, as it would apply to final product prices, thus covering the entire supply chain and reduce the overall environmental footprint (Coderoni 2015). The table below shows the economic value of the final consumption of each product categories; the social cost being related to their GHG emissions. It exemplifies that if the GHG economic impact were included in the total value of final consumption, it would increase the average food price by 14.5% (Camanzi 2017, p. 173).
This policy would decrease GHG emissions, as it would incentivise organic agricultural and extensive production. Due to the fact that it is more environmentally friendly, it would not increment the associated social cost to the final price. Moreover, it would decrease GHG emissions in the supply chain, promoting greater efficiency. The success of this economical tool has already been proven. This has been exemplified by the ‘sugar tax’ in the UK, which achieved a 29% decrease in sugar consumption in products such as yogurts (Campbell 2019). However, it would increase the average food price, causing greater food insecurity. Additionally, this policy does not amend the effects of food speculation, meaning people would remain in vulnerable situations with food access difficulties. Finally, farmers would face fewer revenues if they were not capable of implementing sustainable agricultural techniques as a consequence of a drop in the demand of unsustainable products. The EU could specifically promote policies for these cases by giving subsidies to farmers that could not afford this green transition. Consequently, this policy would mitigate GHG emissions to some extent, but it would also aggravate food insecurity and farmers’ conditions if there is the absence of further economic aids.
Alternatively, the EU could transform the actual food system and base its food production in local decentralised systems; ceasing the international market agreements and funding local producers (Nayyar 2017, p. 16). The territories would be divided into geographical characteristics with the objective of forming self-sufficient communities which are adapted to each particular environment (Goodwin 2014, p. 268). This would situate the food production into diversified local crops and food traceability which will increase food security due to its genetic adaptability to each ecosystem (Esquinas-Alcázar 2005, p. 949). Therefore, organic and extensive agricultural systems will be enhanced; causing a reduction in GHG emissions, the eradication of fertilizers, and healthier diets. Moreover, these local systems would not be affected by international food prices, allowing there to be no food speculation and food security to increase. Additionally, there would be shorter supply chains. This would allow farmers to increase prices yet still reduce the final price for consumers (Patel 2009). This system can be funded with half of the annual expenditure in imported food in the EU, which amounted to €101 billion in 2016 (Eurostat 2017). This could have been invested in boosting local agricultural sectors with appropriate conditions for agriculture. It could have also served as a positive investment for mitigating food insecurity and climate change effects, creating employment and the shortening of supply chains. Moreover, local food systems produce an insignificant amount of waste (Petetin 2020, p. 331). On the other hand, 20% of food is currently wasted, with an associated cost of €143 billion (EC 2020). Thus, the proposed system would distribute food more fairly and reduce costs associated to this issue. Nevertheless, this food system will provide limited access to food variety and possible shortages. However, this could be solved through exceptional basic consumption from the international market.
Recommendations
The EU must transform its food system in the following years and promote a decentralised food system. It would mean becoming the global leader in the fight against climate change and hunger and rejecting international food system. Instead the new system would plan agriculture within planetary boundaries (C&D 2011, pp. 9 and 12). This must be achieved through food democracy as a multilevel food governance model (Petetin 2020, pp. 326) which will result in better decisions for what foods to produce. It would also encourage a rethink on how to use natural resources sustainably by making better use of local knowledge of agricultural techniques and resource management (Patel 2009). In addition, it would promote multifunctional landscape planning and cross-sectoral integrated management; increasing food security, the ecological balance, and so on (UN 2020). There have been projects that have already pursued the objective of mitigating climate change and hunger, such as the foundation of urban garden in cities. These projects follow the scheme that has been already developed as a second policy option. It has been proven to enhance the agricultural and self-reliant culture, as well as new infrastructures that maximises efficient agricultural spaces such as roofs and unused buildings. This can be exemplified in Paris, where this project has joint cooperation between the private and public sector and already has targets to feed between 100,000 and 200,000 Parisians, most of them being low-income citizens (Henley 2020). Therefore, this paper recommends a transformation of the EU food system into a democratic system; prompting an ecological balance in the agriculture sector, food security as well as the empowerment of citizens.
However, it is arguably unrealistic to radically transform the current food system, due to its intrinsic roots in economic and cultural globalisation. Thus, a progressive transition process is recommended in the EU. Globalisation is present in our daily life and inherently protects ‘economics over politics, corporate demands over public policy, private over public interest, or transnational corporation over the national state’ (Teplee 2000, p. 10) due to this system depending on economic growth to maintain basic prosperity levels. Furthermore, citizens are familiar with this reality and would fear the unknown. Therefore, in order to promote a food system disconnected from the international market, the EU must follow a progressive alienation process from it. This procedure will create a social behavioral change based on experience and knowledge.
This progressive transition process in the European food system should be supported with the first policy optio, as a means to intervene in the international market and internalise social costs on products while financing local food systems. The GHG tax must be implemented; prompting local consumption behavior and industrial transformation into a more organic model. Once pursued, the second policy option must be implemented gradually. This transition can be funded by the €143 billion from waste associated costs per year (EC 2020) and the €101 billon annual expenditure in imported food (Eurostat 2017) as explained previously. Moreover, 50% of current direct payments to unsustainable agriculture signed on the new CAP can be used. This would add another €193 billion (Boffey, 2020) for investments into a new food system model. This would create an ecological, cooperative and democratic infrastructure capable of feeding its local regions while increasing health, food security and decision-making. The food system transformation will promote cheaper and efficient allocation of food in their local areas and reinforce local money circulation; thus avoiding a flight of capital linked to the agricultural sector. As a result of these successes, there will be an incremental access to food – causing higher rates of food security. This transition promotes a behavioral change that supports the transformation of food systems. Finally, the EU would achieve a decrease in GHG from agriculture; empowering citizens and ensuring food security through democratic food sovereignty.
Featured image credit: “Community Food Security” by Visible Hand is licensed under CC BY 2.0
Disclaimer: This policy paper is a revised version of a policy paper originally written in November 2020
Key Sources
Ludivine Petetin (2020). The COVID-19 Crisis: An Opportunity to Integrate Food Democracy into Post-Pandemic Food Systems. Page. 326, 328, 330, 331, 336. Cambridge University.
Berens, Paul, Bosker, Thijs, Ehrhardt, David, (2020). Food and sustainability. Oxford University Press. Page: 286.
Camanzi, Alikadic, Compagnoni, Merloni, (2017). The impact of greenhouse gas emissions in the EU food chain: A quantitative and economic assessment using an environmentally extended input-output approach. Page: 168, 173.
Nayyar & Dreier (2017). Shaping the Future of Global Food Systems: A Scenarios Analysis. World Economic Forum. Page: 16.
C. Kipkoech, D. Kipkosgei & Murgor (2013). Climate Change and Food Security. IntechOpen.
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