Food & drink

The False Promise of Provenance

Oakham is a rural town in England. Oakham™ is the name of a range of chicken products sold by Marks & Spencer, none of which are actually produced in Oakham. A case of mistaken identity? No, just a deliberate and potentially highly misleading use of naming and branding to imply provenance. Similarly, Sainsbury’s supermarket has developed a range of beef and lamb products with labelling that features the words: ‘Castle Mey, from the Walled Garden.’ Castle Mey is a real place but closer inspection reveals that the food is not grown there. Instead, Castle Mey is the ‘inspiration’ and the food comes from within 100 miles of the castle. Does any of this really matter? I’d say yes, although there are varying degrees of deception at play. Inventing a place that does not exist is naughty but it’s a game that’s been going on for a very long time. Using a name without permission – or implying that something is local from somewhere when it’s not is, I would suggest, dishonest and may be illegal. ‘Local’ is a big trend in retail, especially food, and the category has grown faster in recent years than either Organic or Fairtrade. Why? Part of the reason is the foot and mouth outbreak of 2001, but it’s also linked to sustainability and climate change.To some extent this is simply retailers and food manufacturers jumping on a bandwagon. Retailers in particular have realised that food needs to be high touch as well as high tech. The EU’s Designation of Origin laws will sort out some of this kafuffle, but consumers still need to watch out. A report by Trading Standards in Hampshire (UK) found that 25% of all food sold as ‘local’ was nothing of the sort. The most blatant attempt at ‘passing off’ was a retailer in Lancashire caught for selling ‘local’ Samphire that actually came from Israel. As for what will happen next, expect retailers to continue along this path for a while, but also expect consumers to switch off and ignore such manipulation or use mobile devices to interrogate packaging to find out what’s really going on.

Food scarcity

In August 2010, food prices increased by 5% globally. Prices were still 30% lower than they had been in 2008, but this didn’t prevent trouble in some far-flung places. In Mozambique, bread prices rose by 30% and ten people died as a result of subsequent riots. So what’s next? Even with depressed growth in advanced economies it looks likely that another surge in food prices is on the horizon and this could, once again, spell trouble. Food has been cheap for a long time and many people now view ingredients that were once considered luxuries as necessities. But this situation is about to change.

The primary problem is population. There are simply more mouths to feed. However, the real issue is not so much demand per se but people’s changing consumption habits. Put simply, more people – especially people in developing markets – are changing eating habits in line with rapidly rising incomes. Hence people that used to live on subsistence diets of rice are now demanding meat. Whatever you call thus trend, the consequence is rapidly rising prices. According to Nomura, the investment bank, ‘the surge in commodity prices in 2003-8 was the largest, longest and most broad-based of any commodity boom since 1980.’ Nomura goes on, ‘The prices of energy and metals surged the most but it was the agricultural market that saw the most fundamental change.’ Short-term shortages and price spikes will probably cause hoarding and speculation and in some cases unrest and anxiety will spill onto the streets. Whether this issue is a permanent feature of the future will largely depend on the weather. If climate change pans out as many people suspect, then shortages could become more permanent, at least until the unlimited resource of human ingenuity starts to work its magic. What seems most likely is that uncertainty concerning supply and wild volatility in terms of prices could be here to stay for a very long time.

‘Long soil’

According to the World Bank, agricultural production must increase by 70% by the year 2050. Why? The primary reason is demographic – there will be more people and they will want to eat. The second reason is consumption habits – more people with more money means switching to meat-based diets, especially in Asia. The third reason is bio-fuels. Energy companies are interested in land not because of what lies beneath but because of what can be grown on top. The result? People taking a ‘long’ position on fertile land, especially in foreign lands, with the expectation that the value of the land and the food grown on it will increase substantially over the years ahead (hence the term ‘long soil’). For example, according to the World Bank, purchases of land in developing regions increased tenfold in 2009 to 45 million hectares. This trend is set to make the value of good land soar, especially well-watered hinterlands in Africa and Latin America. But buyers beware. Land isn’t just another commodity. Land is tied up with notions of nationalism and is semi-sacred in many regions and this trend could represent the early stages of the unravelling of globalization. For example, Guiherme Cassel, the Brazilian farms minister, has said that’ ‘Brazilian land must stay in the hands of Brazilians.’

What’s next? Expect a global land grab by wealthy foreign investors (especially Chinese and Middle-Eastern sovereign wealth funds) to increase substantially over the coming years – but also expect protectionist backlashes over the purchase, or attempted purchase, of land by foreign investors. Also expect the issue of water access to rise to the surface on the back of this trend.

Calorie inflation

Despite the fact that, globally, one billion people are now obese, the idea that chocolate could be as addictive as cocaine has been fringe thinking for quite a while. But the theory is now starting to enter mainstream thought. As a result, some observers are predicting that some kinds of food may soon be legislated against in a similar way to alcohol and tobacco. There could even be an attempt at a class legal action against the big food companies for knowingly ‘pushing’ food that they know to be – or design to be – addictive. Sugar is at the epicentre of this controversy. Rats fed on sugar syrup have been shown to develop behaviours that are chemically identical to rats fed on and addicted to morphine.

Critically, studies have also shown that when rats binge on sugar syrup their brains release dopamine, a neurotransmitter linked to pleasure seeking. This finding provides a biological linkage to sugar addiction and suggests that you don’t have to be overweight for your brain to exhibit such behaviour. More worryingly, as people overeat, food makes them feel less satisfied, which leads people to eat more food to create more of an effect – a situation identical to the use of Class-A drugs. This may not sound like a big deal, but if certain foods can be proven to be addictive the consequences will be significant. First, we can expect government legislation and labelling. Second, we will see significant legal action. Third, individuals will point the finger at companies and governments rather than themselves. We may also see the development of food addiction ‘patches’ (similar to nicotine patches) and junk food retail may be legislated against, either in terms of taxation, zoning or outright bans.

Think this is far-fetched? In New York City and across California, transfats have now been banned in restaurants and soft drinks have been voluntary removed from school vending machines in anticipation of future legal action. And we might see some interesting ‘carrot’ approaches too. Companies that produce – or individuals that consume – low calorie foods might receive tax credits for instance. So what else might we see in the not too distant future? One answer is more scientifically engineered foods to target the worldwide obesity epidemic. Nestle, the world’s biggest food company, has recently created a health science business to create foods that don’t make people fat. To some extent this may be a defensive action. Hershey and Mars have made similar moves, although the history of such adventures is patchy. Unilever, for instance, spent $20m trying to develop a niche slimming product before conceding defeat in late 2008. But why are we getting fatter? One reason is easy availability of relatively cheap food. Another reason might be stress (we eat to feel less anxious). You could also point the finger at more sedentary lifestyles, although research suggests that this is a red herring. Physical activity has hardly changed over the last 25 years. However, what we eat has changed. The average calorific content of food has risen by 12% in the UK and by 25% in the US over the same 25-year period. In other words, much of the responsibility does belong to the food industry although individuals aren’t entirely blameless.

Precision agriculture

Given rising food prices and climate change induced food shortages, the ability of agriculture to deliver maximum productivity is in the spotlight. Until quite recently most farmers used a system of experience mixed with trial and error and luck to produce crops but things are changing. Precision agriculture is a term used to describe the use of hyper-specific GPS and digital mapping to precisely control the application of seeds, pesticides and perhaps water to crops and, on occasion, livestock. For example, precise satellite imagery of fields enables farmers to vary the delivery of chemicals down to areas as small as 2.5cm – or a single plant. This means minimum waste and pesticide residue runoff into adjacent habitats, and maximum profitability. Such use of GPS is made even more accurate by the use of real-time kinematics, which is essentially the use of fixed GPS receivers with their own longitude and latitude to deliver additional information about the local terrain and bolster satellite accuracy. In some instances, the system is so precise that seeds can be planted at exactly the same spot that fertiliser granules were spread months earlier. So what’s the future of technology-aided farming look like exactly? In the UK, 13% of farmers are now using auto-steering on farm machinery and in the not to distant future we will almost certainly see the development of automated, driverless vehicles that work, alone, out in the fields. From there it’s not much of a giant step to develop semi-intelligent harvester robots or robots that can go off by themselves to look for weeds or sick animals. If you think that last idea is a little fanciful, consider for a moment that there is already a system in use in parts of the UK whereby video feeds are used to automatically monitor animals, working out when they are ready to be slaughtered. The technology maps animal outlines and then uses algorhythms to work out weight, feed requirements and likely market days. BTW, if the idea of remote control or online farming tickles your fancy, take a look at www.leverduredelmioorto.it. This is an Italian company that allows urban dwellers the chance to sow seeds virtually in online plots, but then have the planting plan sown for real on a farm in northern Italy. Once crops are ready for harvest they are sent to the customers door within 24-hours.