Short food supply chains in European agriculture: potential for growth?

Thursday 20 September 2018

The limitation or even the absence of intermediaries between producers and consumers should help farmers sell fresh products at prices that allow them to earn more equitable income. Faced with large-scale distribution, which is the single point of market entry for many farmers, short-circuit selling remains relatively limited in Europe but has some growth potential due to several advantages: better remuneration of producers, purchase of fresh seasonal and local products, better traceability of products, feedback on the quality of production thanks to direct contact with the customer. However, short food supply chains also have disadvantages: producers need more resources since they themselves sell and process, consumers find it difficult to commit to a long-term relationship with the same producers and must go to the point of sale at specific times.

A study by the European Parliament Research Service revealed that in 2015, 15% of farmers sold half of their production through short food supply chains.[1] These take many forms: direct sales at the farm, at the market place, local counters, online sales. In France, the associations for the maintenance of small-scale agriculture (AMAP) offer a guaranteed income to farmers since consumers pay in advance products for a period defined by contract and at more favorable prices for producers than the ones offered by supermarket chains.[2] Similar initiatives exist in other countries, such as Poland, where a website was launched in 2014 that allows a large number of people to buy local products together in order to share the costs while ensuring a fair income for producers. Through this system, more than 100,000 people obtain supplies from 150 farmers and processors.


Short food supply chains thus make it possible to circumvent the purchasing conditions imposed by large retailers which are often unfavorable to producers, as this Walloon farmer explains: "They [the wholesalers] are the ones who determine prices and quantities, and that must be accepted or refused."[3] Conversely, short food supply chains are supposed to favor less asymmetrical sales relationships and more solidarity. As a study in Nord-Pas-de-Calais (France) on short food supply chains explains, reciprocal trust "is regarded as unavoidable by stakeholders because of a mutual desire for long-term, non-formalized relationships for the sale of a product whose quality is not objectified by brands or labels."[4] In parallel with trust, values ​​of solidarity and conviviality are put forward by consumers, as illustrated by two studies conducted in Italy and France: "66 % of French respondents (Chiffoleau, Prevost, 2014) and 79% of Italians said that support for local farmers was a motivation to commit. (...) In addition, 63% of Italian interviewees added that short circuits represent for them an opportunity to build new social links (Grasseni et al., 2013)."[5] Short circuits also allow producers to listen to customer feedback on their products to improve their quality.

 

Challenges implied by short food supply chains

Although minimizing the distance between the producer and the plate is intended to better pay producers, better satisfy consumers and reduce the impact of agricultural trade on the environment, choosing a short circuit is not choosing simplicity. On the contrary, it has nothing to do with the ease offered by supermarkets: a wide variety of products at the same place, low prices, products with calibrated shapes, geographical proximity. Conversely, it is not easy to find short circuits for all desired products, especially those that are not seasonal. It is not necessarily easy either to get organized to buy products at times that are also suitable for producers, while for supermarkets, open 6 or even 7 days out of 7, the question doesn’t arise. Consumption relying on short chains therefore requires efforts from consumers despite the many related benefits.

From the producers' point of view, the advantages of short food supply chains also imply some challenges: first, there is the need for additional resources to promote, display and sell the products. Advertising the products or the place of sale requires time and new skills (e.g. marketing). In addition, offering products directly consumable by the customer (e.g. cheese and meat) requires the processing of certain raw products, an activity that is also time and labor consuming. Thus, engaging in short food supply chains often involves investing in labor-force and equipment. At the same time, producers are dependent on end consumers, who are not always willing to commit directly to a long-term buying relationship because of possible holidays, relocation and other reasons that may reduce their demand as fixed in the contract (in the case of AMAP) or prevent them from going to the usual place of sale.

 

European action vis-à-vis short food supply chains

The EU's Common Agricultural Policy (CAP) supports short food supply chains with nearly € 800 million allocated in the 2014-2020 multiannual program. The European Agricultural Fund for Rural Development (EAFRD) financed the "Couleurs paysannes" project, which brings together sixty farms in the French PACA region that employ 200 people and sell their products directly to consumers through a sales website and several stores."[6]


However, the next CAP, as proposed by the European Commission at the beginning of June, plans a reduction in financial aid for rural development after 2020, thus leaving the issue of funding short food supply chains in the hand of the Member States.[7] Furthermore, the draft directive tackling unfair commercial practices in the food chain is not intended to favor short food supply chains, but rather to increase fairness in the current distribution chain.[8]


Being above all an individual choice of consumption, the development of short food supply chains will require the promotion and valorization of local agriculture, the adoption of targeted measures (e.g. funds allocated to the hiring of promoters of short-circuit products, on-site processing and logistical expenses) and will have a lasting effect if the advantages of short chains exchanges outweigh the disadvantages for both producers and consumers.



[1] « Les circuits courts démarrent lentement en Europe » : https://www.euractiv.fr/section/agriculture-alimentation/special_report/les-circuits-courts-en-europe-du-nord/

[2] See the  « charte des AMAP » : http://miramap.org/IMG/pdf/charte_des_amap_mars_2014-3.pdf 

[3] « Polish project aims to stop food travelling more than you do » : https://www.euractiv.com/section/agriculture-food/news/dont-let-your-food-travel-more-than-you-do/

[4] H. Capocci, « Des circuits courts pour changer le monde? », p.7, https://www.entraide.be/IMG/pdf/analyse_circuits_courts.pdf

[5] A.Gonçalves, T. Zeroual, « Analyser les impacts des circuits courts alimentaires : une étude en Nord-Pas-de-Calais » : https://journals.openedition.org/regulation/11986

[6] H. Capocci, op.cit. p.4, https://www.entraide.be/IMG/pdf/analyse_circuits_courts.pdf

[7] Les circuits courts se développent en France grâce aux fonds européens : https://ec.europa.eu/france/news/20170412_decodeursue_circuits-courts_fr

[8] Commission throws the ball to EU capitals on future of short food chains : https://www.euractiv.com/section/agriculture-food/news/commission-throws-the-ball-to-eu-member-states-on-future-of-short-food-chains/?_ga=2.38041827.1154923835.1536532571-1125473920.1530830589

[9] European Commission acts to ban unfair trade practices in the food supply chain : http://europa.eu/rapid/press-release_IP-18-2702_en.htm

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