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Supply chain, power relationships and local
food systems
Preliminary results from an ongoing research : “Institutional
architectures for sustainable food systems”
(Keywords: globalization, sustainability, local food systems,
participatory democracy )
Valeria Sodano
Department of Agricultural Economics, University of Naples “Federico II”
V.Sodano, University of Naples
federico II
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THE MAIN ISSUE
Sustainability is defined with respsect to cociety, economy, environment
Globalization is jeopardizing sustainability of the food system .
During the last twenty years public intervention have been undermined in
every field of economic and social organization because of TNCs and
international bodies such as the WTO imposing their neoliberal trade
agenda
Food local systems are a kind of organizational form able to
promote sustainability when state intervention is no longer
able to accomplish the task of correcting the different forms
of market failures that contrast sustainability
V.Sodano, University of Naples
federico II
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LOCAL FOOD SYSTEMS: DEFINITIONS
A food system comprises the interdependent and linked
activities that result in the production and exchange of food.
A food system is local when it allows farmers, food producers
and their customers to somehow interact face-to-face at point
of purchase. Consumers are linked to producers by bonds of
community as well as economy.
Community Food Systems (Gillespie, A. and Gillespie, G. 2000. Community
Food Systems: Toward a Common Language for Building Productive Partnerships. Cornell
A community food system is a food system in
which food production, processing, distribution and consumption
are integrated to enhance the environmental, economic, social and
nutritional health of a particular place.
Cooperative Extension)
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SUSTAINABILITY OF FOOD SYSTEMS IS A WIDE
CONCEPT WHEN ASSUMING THE PRINCIPLE OF
“FOOD FOR COMMUNITY” INSTEAD OF “FOOD AS
COMMODITY” (IIED, 2006).
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FOOD FOR COMMUNITY
FOOD AS COMMODITY
Food is a basic human need and right
Food is a commodity
Farming connects people to the land
Farming like factory operations
Positive externalities (Farming providing
environmental and social benefits, gain of
social capital)
Negative externalities (pesticides, soil
erosion, declining of rural communities
and local food traditions, loss of social
capital)
Eating is an act of communion with the
Earth
Eating is an unconscious act aimed at
refluing our bodies and is largely
affected by compulsory nevrotic
behaviors
Communities partecipate in making
decisions about their food supply
Large corporations control the food
supply at the
rhe expense of communities
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A sustainable food system is one able to correct
market failures due to public goods, negative
externalities, and “future generation issue”.
When market fails , the process of resource
allocation needs to be performed by alternative
institutions, as for example power and gift-relations
(Sodano, 2006).
Unfortunately experimental behavioral economics
has largely demonstrated that gift relations based on
altruistic attitude are very rare in practice.
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- In the process of resource allocation, in the economic field, goods
are continually transferred from an actor to another actor.
- For perfect private goods these “transfers” are regulated by free
voluntary market exchanges.
- In the case of public goods different form of regulation are
needed, these are basically rules relying on power and on giftrelations (Consumer social responsibility and corporate social
responsibility can be considered as special cases of giftrelationships)
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AS A CONSEQUENCE:
SUSTAINABILITY OF FOOD SYSTEMS IS MORE LIKELY TO
BE FOSTERED BY POWER (AND THUS BY POLITICS) THAN
BY ALTRUISM (AND THUS BY ETHICS)
Power needs to be legitimated by the society, hopefully in a democratic way.
In the period between the second world war and the eighties, in Western
Europe nation democratic states have widely carried out policies aimed at
correcting market failures, and providing those basic goods and services
needed to assure life and human rights to their citizens.
During the last twenty years the process of globalization has dramatically
undermined public intervention in every field of economic and social
organization
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Localization is about the process of restoring public policies on the
basis of a participatory democracy, a democracy that involves
popular control and equality and ensures real participation (not
simply through elections) in managing food, environment, health and
all those public goods that the private sector is not able-willing to
supply.
CONCLUDING:
LOCAL FOOD SYSTEMS CAN BE CONSIDERED AS A FORM OF ECONOMIC
ORGANIZATION THAT SOLVES THE PUBLIC GOODS PROBLEM,
STEMMING FROM THE VIEW OF FOOD FOR COMMUNITY AND NOT FOOD
AS A COMMODITY, THROUGH PARTICIPATORY DEMOCRACY.
All the following nine options for localizing foods rely on some of participation
led by trust and solidarity.
V.Sodano, University of Naples
federico II
NINE OPTIONS FOR LOCALIZING FOOD (PRETY J. ,2001):
1. Community Supported Agriculture (CSA)
The basic model is simple: consumers pay growers for a share of the total farm
produce, and growers provide a weekly share of food of a guaranteed quality and
quantity.
2. Box Schemes
In the UK, there are 20 large schemes and another 280 small ones are supplying
some 60,000
households weekly A central rationale for both CSAs and box schemes is that they
emphasise that payment is not just for the food, but for support of the farm as a
whole.
3. Farmers’ Groups
Farmers can create new value in agricultural systems working together in groups.
4. Consumer Groups and Cooperatives
Direct links between consumers and farmers have had spectacular success in
Japan, with the rapid growth of the consumer co-operatives, sanchoku groups
(direct from the place of production) and teikei schemes (tie-up or mutual
compromise between consumers and producers).
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NINE OPTIONS FOR LOCALIZING FOOD (PRETY J. ,2001):
5. Farmers’ Markets
Sell your produce directly to a consumer, and you get 80-90% of the food pound
instead of the paltry 8-10% through normal marketing mechanisms. In the UK,
there were 200 established Farmers’ Markets trading on some 3000 market days
per year in early 2001.
6. Community Gardens
In developing countries, 100-200 million urban dwellers are now urban farmers,
providing food some for at some 700 million people.
7. Clear Labelling Eco-labels
They allow growers and processors to be rewarded for using environmentallyfriendly production processes. They also permit consumers to express their values
whilst making purchases.
8. Food Webs and Local Shops
Small retailers, producers and consumers creates a dense social network that
provides employment, good quality food and wider social benefits.
9. Slow Food Systems
Slow and distinctive food, resonant of place and people.
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THE BENEFITS OF LOCAL FOOD SYSTEMS
-Food swaps and food miles.
Average meal travel in a local food system= 45 miles; average
meal travels in the conventional food system: 1500 miles. In the
US each item of food travels 2000 km from field to plate.
- More jobs and “safer” labor.
- Improving food sovreinty.
- Improving food security .
- Strengthening culture and societal activities.
- Bioregionalism implying the integration of human activities
within ecological limits.
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THREATS TO LOCAL FOOD SYSTEM
Consolidate corporate power
Economic subsidies and incentives that favor big business
Preemption (laws preventing local governments from passing policies and
initiatives that regulate the food sector and the environment).
Free trade ( Legally binding international trade agreements can remove a
country’s ability to restrict food imports for health, safety, or environmental
reasons).
Health, safety and environmental standards (when these are used by
big business to shape policy in its favor and burden smaller business).
Disinformation (marketing campaigns portraying the global scale food
system as the key to economic prosperity).
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A CASE STUDY: THE MARKET FOR FRESH PRODUCE IN ITALY,
TRADITIONAL RETAILERS AND REGIONAL MARKETS VS LARGE
RETAILERS’
In Italy the fresh produce market exhibits a polarized structure, with
the 70% of the market dominated by few large chains of
supermarkets and the remaining part of the market covered by the
“so-called” traditional retailers, i.e. small specialized retailers
located in residential areas and in the traditional food trade centers
of towns.
Strategies carried out towards customer and suppliers by
supermarkets do not promote sustainability, being characterized by
high distance suppliers, standardized productions, power relationships and
technology-intensive innovation policies
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On the contrary traditional retailers are integrated in more
sustainable local production-consumption systems, characterized by
local small suppliers, high product variety, trust-based relationships
and innovation policies aimed to restore traditional sustainable
production processes and food styles more than to experiment new bio
and nanotechnologies.
Notwithstanding its high performance in term of sustainability and
consumer satisfaction, the traditional sector is very likely to be forced
to exit the market in the next years, due to the aggressive competitive
behaviors of supermarkets and to the lack of state intervention in the
field of environment protection
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One way for these regional markets to survive is to turn themselves
in real local food system, where a deliberative process of
communication and participation among the different stakeholders of
the system might strengthen producer-consumer relationships on the
basis of a shared preference for “food for community” instead of
“food as commodity”.
Only one in five of the analyzed regional markets seems to
experiment such a “metamorphosis”.
More research effort on theoretical and empirical ground is
requested in order to assess the real attitude of Italian food
market towards sustainable local food systems
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federico II
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