Sustain supply or lose profit, food industry warned

By Charlotte Eyre

- Last updated on GMT

Related tags: Sustainability, Ciaa

The food industry must support EU farmers during the current
commodity squeeze, as a sustainable supply of agricultural
materials is vital for healthy profits, experts warned yesterday.

During a two day conference organised with the Sustainable Agriculture Initiative (SAI), the Confederation of the Food and Drink Industries of the EU (CIAA) said that food processors buy, process, and then sell 70 per cent of region's agricultural output, and so are hugely responsible for maintaining a healthy food chain. Food manufacturers are increasingly being held to answer by regulators as well as consumers, as the world's growing population, adverse weather conditions and consumer vigilance are all putting pressure on how the industry sources and processes produce. Grain processors must be particularly vigilant, the CIAA said, as cereals represent almost 50 per cent of total human consumption - 40 per cent in developed countries and 60 per cent in developing nations. "We in the food and drink industry are business men, just as farmers are businessmen,"​ said CIAA President Jean Martin. "Keeping farmers and farm products profitable is one key to achieving maximum sustainability." ​As well as setting up sustainability schemes, the food and drink industry must discuss a variety of issues with farmers, such as requirement compliance, management structures and inspections, the CIAA said. According to the confederation, a concerted effort from companies will benefit everyone concerned. "The drivers for setting up sustainability initiatives can be the increased effectiveness of supply management or differentiation through specific quality,"​ the CIAA added. Many companies are indeed waking up to the benefits of such programmes, and only this week five food manufacturers joined the Global Reporting Initiative (GRI), a network established to help companies report on sustainability projects. Nestle, Bunge, Danisco, Green Mountain Coffee Roasters and Tyson Foods will all now be given "specific guidance" over issues such as water conservation, pollution controls and ethical sourcing, the GRI said. According to the SAI, all manufacturers should set up similar programmes that help support farmers, as the pressure on commodity supplies is not likely to let up any time soon. The global population is projected to grow from six billion to nine billion by 2050, the SAI said, while developed and developing nations will demand more diverse food. High demand for cereals has already double the world harvest between 1968 and 1998, from 1161 to 2054 tonnes, the SAI said. In the dairy sector, on the other hand, consumption of milk alone has reached 516 million tonnes, just about the same as in 2003 and 1 per cent more than in 2002.

Related topics: Markets

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