This post first appeared online at http://www.thatsfarming.com on the 14th August 2017
I have been around long enough to remember the passing of the UK’s Food Safety Act in 1990, it was when I first came across the Defence of Due Diligence. The timing coincided with the rise of the supermarkets and their dominance of the food supply chains and it was easy to recognize that being diligent was going to be a serious activity for those who supplied the nation’s food.
Those who supply food anywhere in our ‘modern’ world must now be able to demonstrate that they have taken all reasonable precautions to ensure the safety of their food and that they have systems in place to demonstrate their diligence. A consequence is that food retailers need to verify their suppliers and processors their sources of raw materials, thus giving rise to quality assurance schemes throughout food and farming. With concerns about resource use and climate change, they now increasingly encompass ‘sustainability’.
These quality assurance schemes must not, however, be confused with premium quality. They are akin to factory-based quality control systems; they ensure the quality of the product, be it aimed at the budget, standard or premium markets. Probably all car manufactures operate QA systems to ensure that their product meets their own determined quality level. With farm assurance, it is about assuring how the product has been produced, be it of a budget, standard or premium quality.
Quality assurance schemes have become a part of Irish farming. It is difficult to sell animals for meat that do not come from quality-assured farms and milk processors are now demanding that their milk supplies are quality assured. For all but those farmers who process their own milk or have niche markets for their meat animals, de facto, being quality-assured is now obligatory. Such nationwide schemes are powerful market-access tools for Ireland’s food sector but they are just that, market-access tools. It is a misnomer to believe that they will deliver a premium farm-gate price.
The achievement of the QA schemes is that they provide near industry-wide farm-assurance for Irish produce. The question is, do they deliver a wholesale rise in farm-gate price across the industry? Do they enhance the value of Irish produce overseas? Scrutinizing the position of Irish beef in the UK market should provide an answer. My own observations are that they only allow retailers to sell farm-assured, due-diligence-box-ticking products in their standard and budget ranges. The QA schemes do not appear to be providing access to the top shelves.
In the beef sector, the breed schemes do provide another differentiator beyond the standard farm assurance QA schemes. But just how effective are they at delivering a significant farm-gate price premium? Angus is now a global brand, probably more so than Hereford, and it is being developed large-scale in places as far afield as Russia and New Zealand. There is, however, an Achille’s heel with the breed schemes, they have no volume control because of their sire-only requirement. In other words, conformation notwithstanding, any old cow and a straw can, in theory, produce another beef-scheme animal. With no limitation on supply, simple economics means ‘success’ will increase supply and erode any existing farm-gate premium down to a break-even price.
The QA schemes may, however, yet prove invaluable, albeit by accident rather than design, with Brexit looming. One does not expect UK supermarkets and food-service providers to change their position in terms of requiring farm-assured products and Ireland will remain well positioned with that regard, not least because of locality. It is, however, not a laurel we can sit upon for long.
The QA schemes are a success, albeit a limited one. Ireland can deliver farm-assured produce to the corporate players in the supply chain, be they retailers, in food service, or processors. On an industry-wide basis Ireland has been a first-mover, but first-mover advantage only remains for the duration it takes others to follow, and they will. Beyond that, what makes Irish produce unique? Yes, there is a value in ‘Irish’ but that only has real value when accompanied by other characteristics.
Simply, we need to be developing new, more in-depth, quality-assurance schemes that are firmly linked to farming practices that the consumer recognizes as imparting quality, be it eating or otherwise. Their development needs to be farmer driven and farmer owned. The products produced and labelled under these schemes then need to be delivered to the market by supply-chains that the farmer can influence to the degree that they deliver a fair return to the farmer-producer. Only then will quality-assurance deliver the market-derived returns that small-scale, Irish farmers need.
Meanwhile, quality assurance as we know it provides a defence of due-diligence for Ireland’s high-throughput-focused processors; but something more is needed to enhance the economic future of the Irish farming family. Quality assurance does provide a foundation stone for enhancing farm-gate prices, but only that. It comes with a cost and it is a cost that many farmers do not easily recognize the benefit of. Much more needs to be done but one sees little sign of it happening, not least because those who should be striving for more do not seem to realize that they have only just begun the process. Quality-assurance schemes can revolutionize the future of Irish farming but there needs to be changes beyond the farm-gate for that to happen. So, when do we start?