April 26, 2023 • 28 mins
- An old episode from the Red to Green Podcast on Food Tech & Bio Tech. Listen if you are interested in the future of food, but this isn’t Scaling Nerds.
Red to Green was a podcast that investigated how to transition the food industry from harmful to healthy, from polluting to sustainable, from Red to Green. Each season had a different topic
- Season: Cultivated Meat
- Season: Plastic Alternatives
- Season: Food History
- Season: Food Waste
- Season: Biotech in Food
- Season: Book Reviews on the future of food
Welcome to our season called "Book Talks." In the first two episodes, we will cover the book "Stuffed and Starved - the hidden battle for our world's food system."
The author Raj Patel is a British Indian. Academic journalist and activist. He holds a Ph.D. in development and sociology from Cornell University. In this book, he focuses a lot on the inequality of our food system. The book's main thesis is that more people are overweight than people who are starving. And that's solving the issue is now our food system is not just about increasing yield. It's much more a poverty and distribution issue.
I'm joined by my amazing co-host Frank Kuehne. He's the managing partner of the Adalbert-Raps Foundation, which offers grants for scientific research in food technology, but more on that later. Let's jump right in.
LINKS
Get funding for your food science research: https://en.raps-stiftung.de/
Find out more about the book Stuffed and Starved
More info and links to resources on https://redtogreen.solutions/ Â
Connect with the host, Marina https://www.linkedin.com/in/schmidt-marina/
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More info and links to resources on  https://redtogreen.solutions/ Â
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
I've been confronted with my owntruths here and more than once I
had to put down the book and think about why do I feel
uncomfortable in the way? He's putting the story, Welcome
to our season called booked arcsin the first two episodes, we
will cover the book stuffed and starved, the hidden battle for
(00:20):
our world's food system. The author vigy for Raj Patel is
a British Indian academic journalists and activists he
Holds a PhD in development sociology from Cornell
University in this book. He focuses a lot on the
inequality of our food system. The main thesis of the book is
(00:40):
that there are more people who are overweight than people who
are starving. And that solving the issues in
our food system is not just about increasing yield, and it's
much, more poverty and distribution issue.
I'm joined by my amazing co-hostFrank cunha in this thing.
Season and he's the managing partner of the adult bird wraps
(01:03):
Foundation which offers grants for scientific research in food
technology. But more on that later, let's
Jump Right In Red to Green is the most in-depth podcast on
food sustainability. And in this season 7 we discuss
key takeaways from books on the food system, I'm your host
(01:24):
Marina Schmidt and I'm joined bymy co-host, Frank Keenan?
So I think the way that Rush Hotel describes it is he looks
at it. Historically, he also breaks it
Down based on who is to blame ornot even who's to blame.
But what are the issues in the current system and then
(01:45):
therefore like who has the most responsibility to fix it?
So one of his Central themes is,of course multinationals and the
liberalization of the markets caused a lot of issues.
The first thesis is Our food system is an hourglass shaped
food system and that is an issue.
So he has this overview where heshows, Netherlands, Germany,
(02:08):
France, UK Austrian Belgium, andwhat their food supply chain
looks like. If you look at how many players
are each step of the supply chain and then it's over 3
million farmers, and producers and becomes smaller and smaller
less suppliers, even less manufacturers.
Only Manufacturers. The overview from the book is
(02:31):
actually from data ranging from 2000 to 2007.
So I wouldn't put too much emphasis on the actual numbers.
It's more about the principle and just having that in mind,
that we have a lot of farmers atthe top of the Hour Glass shape.
Then it becomes thin when we look at the middle stage of the
(02:52):
supply chain. So that means manufacturers and
retailers, especially and then as it keeps going Ying it
broadens again. When we look at the actual
consumer base, where it becomes the widest and then there are
only 110 buying desks. I actually double-check like
what that exactly means. So yeah.
(03:14):
What is it? You were wondering.
Yes, wondering do I never have it?
The term and I've been working the food industry for the last
20 years old. What is a buying desk in Europe?
Tell me? Yeah, exactly.
He also didn't explain that. The Retailer's, they give the
power to agencies. You're responsible for
purchasing. So, there are 110 buying desks
or agencies that make decisions about what to purchase, but I
(03:37):
think he simplifies too much. And from all my experience, I
never actually talked to a buying desk.
I always been negotiating directly with the retailers.
So you're invited to come to theadministration office to
Purchasing Office and you have tough negotiations with them
about the product, you want to sell to them, or the product
they want to buy from you. And I think, What he means is an
(04:00):
hour. Actually, not quite sure if that
is actually sorry. True.
I would different between and process agriculture products
like vegetables or plants that we eat and then there's packed
food and just processed food andit's frozen food in Saunders.
So I think perhaps and then might be true.
Agricultural products are boughtby buying desk but the majority
(04:21):
of products are bought directly from retailer.
They have the purchasing power. Why should they go directly via
a buying desk? I think this hour.
Glass shape is very catchy and even if you take out the buying
desks, right, you removed them. Okay, let's go.
Okay, let's remove the - where the thin part of the our glasses
where the sand kernel of sustainability has to press
(04:42):
itself. Through is the supermarket's the
Retailer's is there. Only 600 retailer chains and
connected. You know to the book, the carbon
footprint of everything we were discussing.
Oh we know are fried is a bad getting your food from heated.
(05:02):
Greenhouses is horrible for the environment but the consumer
cannot have a decision. That is balanced because it's
not on the labels, not on a label.
If the retailer is, would say wecan just decide we're not going
to buy and sell foods that have such a high CO2 emission, that's
(05:23):
unnecessary. Then that wouldn't be even an
issue. But of course then you rely On
the retailer sustainability goals and also would I think
he's pointing at is the entire system, the liberal market
system, just incentivizes everybody to just go for a
profit as the only bottom line. I think in the book, The
(05:44):
Hourglass example is like one ofthese things where I can say
there is some truth in it. And, and I think he's right when
he says, what is the purpose of the food system?
The purpose of the food system, Is not to feed us but we do it
for a profit. He basically he blames the
industry and the Traders and thepoliticians for setting up a
(06:08):
richt game. Yeah.
Because actually, his thesis is the market liberalization and
the building of multinationals was argued, based on.
We need this to make it cheaper for the consumers.
He argues that that isn't actually always the case.
So there isn't a very Interesting explanation of
(06:30):
NAFTA. So I will quote him again here
to give you a bit of the Viewpoint of Raj.
Patel the North American Free Trade Agreement and economic
Union between Mexico and the United States.
And Canada was the mother of allthree trade agreements.
And it was the first to mesh to rich countries with
significantly poorer, one for the majority of poor Farmers
(06:53):
NAFTA, hit heart the price at which you as Farmers sold their
Corn was much lower than the cost to produce it in 2002.
For instance us corn costs about$1 70 per bushel to buy boots to
Dollar sixty for us Farmers to produce.
And this is because of subsidiesfor Machinery, fertilizer credit
(07:17):
and transport that the u.s. is giving and quoting.
Raj Patel, when the price of corn, fell one would have
thought the price of tortilla would have also dropped, but it
didn't it. Fleece or price.
Rise as NAFTA, began January 1994, the average price for a
kilo of tortillas was around 50 pesos by the end of the century,
(07:39):
the price was seven times higher.
But why is that the case? And Rush argues in the tortilla
Market, the number of food processors is very small indeed
to the players, giemsa and mincyactually sound like cheeky
siblings. You know like them together.
They control 97 percent of the industrial corn flower market.
(08:02):
Remember this is a bit of an oldbook so maybe that the specific
numbers aren't as up-to-date. He summarizes the market through
competition of supposed to bringincreased inefficiency and lower
prices, but the effect of turning food production over to
the market, has been to produce less competition and offer more
structural power to the largest companies during the
(08:25):
demonstrations regarding NAFTA. It was announced that Subsidy
for every head of the EU. Cattle was more per day than the
income of three Mexican Farmers.I just found that quite yeah,
quite startling how intense the subsidies are few.
(08:46):
Also compare them on a global scale.
So I thought about this as I could duel expansion of power,
the larger you are as a multinational, the more power
you have just like Amazon, does it right to increase your prices
at some point and then also to push down the prices on the
supplier side. And the thing that I do like
(09:09):
about his focus is that, he talks a lot about what it means
for farmers and how the system is becoming increasingly
unstable. Because there used to be a time
where if you have a local market, you can sort of rely on
there being a need for. Kind of food product, but
(09:29):
nowadays, like a farmer who is growing soy or wheat with the
question of what kind of price you will be able to get for his
crop is so impossible to predictbecause the war in Ukraine and
increasing subsidies in the US or have an impact on the local
farmer. I think that there were so many
(09:50):
things you just said I would like to come back.
Yeah I what I learned again is I'm not a politician, I'm not an
idiot. Additional scientists
understanding the rules and lawsof How It's tution reacts, like
I'm really missing some background information here, it
makes sense to do a little detour and actually explain who
(10:10):
is Frank. Frank has two main positions,
one of them, being the chief of Advisory board at wraps game
behalf. It's a natural ingredients
company in the south of Germany and they are processing herbs
and spices but probably most of his time goes into working for
the adult bear traps. Station, which funds applied
(10:31):
scientific research. For example, they also work with
startups and they fund academic research related to all the
proteins. I've sought to work for the
foundation eight years ago, basically, I'm the managing
director or the managing partnerof the foundation and to clarify
how this is related wraps. The spice company is actually
(10:51):
funding the foundation. The very interesting story, we
never actually talked about thatover the last four decades.
It's roughly 25 percent of the profit of the family.
Business goes into the foundation and then the spent by
the foundation, controlled by the Bavarian government back
into the society for any kind ofprojects.
It's a really great example of acompany that is donating a lot
(11:13):
back to society. You can find out more about the
foundation by Googling the adultbird wraps Foundation.
You can also follow the link in the show notes.
Possibly, you, or somebody, you know, could actually apply for
research. There.
And with that, we can go back into discussing Rush Patel's
criticism how price develops along the supply chain.
(11:37):
So it's more my experience on the industry and working with
industry and reading some books on these topics.
From what I understood is that is a rigged game as well because
it's not freedom of the market, we are blocking out African
Farmers from the European market.
In the same time we allow European products to flow freely
into the African market and buy that disturbing the whole Local
(11:58):
market that's something which isout of my perspective, not
freedom of the market that's already been manipulated in a
way. There's a flaw in the system
again, but that doesn't mean theliberalization of the market is
wrong. So, I think that the main one is
also that the US UK, Japan and Germany like all the
(12:19):
industrialized nations actually did something different.
We have loads of subsidies for our farmers and lots of support
for farmers. And the same time, these
Contracts disallow it in the global South.
So Raj Patel mentions that in the end of the 1970s, the World
Bank was one of the few organizations that had both the
(12:42):
means and the will to extend credit to governments in the
global South and there was all connected to many countries
being close to bankruptcy and they needed money.
So the bank made loans availablebut it did.
So only if certain conditions were met it and those included
is sweet of changes. In the economy, the most
important part is that domestic support the actual support
(13:05):
system for Farmers was dismantled.
So farmers did not have any guarantee Market or minimum
price for their goods. All of that would be dismantled.
Yeah, I agree. And that's what I was trying to
say that on that level on trade level where institutions and
governments agree upon certain terms how they do trade the
(13:26):
system is Not well, balanced there, I can query.
And that's something where we were.
The focus should be on how to improve these systems.
He actually proposed this kind of more complex farmer system
where you have local farmers with it.
I don't know how big a good Farmis but where he has a farm that
(13:48):
is self-sustainable delivering to certain amount of people
around him. The food they can eat, they not
want it, but what you has this system?
On the other level is under risk.
A lot more because you have a Draught, you have a storm, the
yield is gone, there's no Harvest.
Then suddenly the whole local region is out of food and more
(14:11):
Global Food system is able to balance these kind of needs
depending where it comes from this, don't worry, you have
difficult rain season in Vietnam, you're lacking rise.
We can balance that out because there's more rice being grown
and give me a country which is growing rice.
Vietnam, China and China. Let's call it a day.
(14:31):
They basically do everything here.
I am rather more Pro scaling up Farms than contrast, getting up
Farms. I agree with you that scale also
means efficiency. So if people are in general
against industrial large-scale, agriculture, I think there is
also a benefit, right? To every kind of problem that we
(14:52):
have, we need a variety of solutions.
We can benefit in the mix of solutions from regenerative,
huh? Agriculture to improve soil
health. And we can also use community
supported agriculture which leads to Farmers.
Actually, having a good income in the last episode of our food
waste season. I actually talked to a farmer
who is doing community supportedagriculture in New York and she
(15:16):
also diversifies her crops. So she is growing aubergines and
tomatoes, and zucchini, and everything.
And if one thing doesn't work out, then she still has several
different. UPS to work with and the people
agree that while they will take whatever happens to be in
season. That here, agree, like standing
(15:37):
on Thousand Foods is more stablethan standing on one foot.
Yeah, let's say the base issue is that retailers are pushing
the prices for most Farmers to alevel that just doesn't even
allow them to live off of their farming.
Yeah. So the food system from my point
of view. It was because it's profitable.
(15:58):
For driven and scale driven fromsmall entities towards a bigger
business bigger farm system and I was wondering if we would have
a similar discussion when we're looking into the mobility
industry and the change from horse powered cars to real cars
or combustion engine powered cars they disappeared.
(16:19):
Like I was wondering course, it's weird talking about food if
we're looking into the past said, oh it's such a great pass.
We need to keep the farmers up or if you need to let it go.
And said, there's a new development in town.
I'll Food Systems and industrialized food system.
There is no space for small farmers.
Let's make sure they transition to the different job, a
different setup, then trying to keep them in a system, which is
(16:43):
not sustainable for them. Did you see what I mean?
Is I'm not quite sure if we're holding onto a picture of the
past here. Go back 150 years into the
European or the German setup of the farmers and then ask a
family. That was Running a farm at that
times, if they would have want to keep on going or if they
(17:03):
wanted to be industrialized good, it would have said that
isn't an issue that only affectssmall farmers because he also
describes how the liberalizationin terms of NAFTA between the US
market. And the Mexican market led to
huge maze producers, having massive issues because the maze
from Mexico was competing with heavily subsidized corn and
(17:26):
Maize from the US. So the issues of course are we
going to revert liberalization of the market?
No, I think it's just a matter of being aware of that.
So in this case, we need to understand the system as it is,
and it is not fair. There are subsidies like for
example, this their subsidies inGermany for cow's milk
(17:47):
production. I don't think on some drugs
millions and I was thinking today like is my old milk
subsidized. Why do I pay tube?
254 freaking out. Milk, appreciate it.
But what I want is not as happily.
But what I wanted to point out the own experience in the
agriculture business, I have is some hubs and farms and I've
(18:10):
been to big companies growing inhuge volume pepper.
And I've been to not make farmers in India where family
business is basically growing upMax and harvesting the and if
you talk to those families and if you talk to those Farmers,
they don't want to be a farmer, they want.
The biggest issue for us as a spice company or spices and
(18:32):
seasoning company is in regard of sustainability.
Roughly, we're talking to 1.5 million Farmers worldwide,
growing pepper, cumin ginger garlic, cinnamon, whatever,
clothes, whatever, you can thinkof.
I'm not able even if I want to have a certain sustainable
standards. I can't push them through the
(18:52):
system to the farmers. I can't talk as a midsize
company to 1.5 million. A farmer's.
It's a lot easier to set up a discussion about our
sustainability goals with a bigger player like allam who's
growing pepper in Vietnam. It's so the solution is just
something I wanted to highlight that.
I think there are disadvantages with this kind of local farmer
(19:17):
midsize sustainable. And we're not only talking about
the farmers in the United Statesand in Europe and we're talking
about farmers in Africa that have a small plot of land.
They have two goats And they barely survived from what they
grow at a very idealistic picture, sometimes of the farmer
being so sustained, you gave me an idea here.
(19:37):
So what I find so fascinating, when we did the food waste
season, if you look at the breakdowns, two to three percent
of the food waste along the supply chain is caused by
retailers and like in France they had the regulation that
it's a necessity for retailers to they are obliged to pass it
on but oftentimes they pass on Yellow broccoli like something
(19:59):
that's already not eatable. Okay.
Maybe this needs a little bit more explanation.
So in France it has become obligatory for grocery stores to
donate their leftover food and one issue that came up with that
is that sometimes retailers would donate it.
We too late. So donate yellow broccoli.
(20:22):
But the thing is that once it's donated, whether it's eaten or
not retailers, can Check it off their books, they don't need to
account for the food waste if they have passed it on in some
kind of fashion. So to me, it's always the
question who has the power who has the ability to negotiate,
the strongest, who has the ability to divert both risk and
(20:47):
responsibility up and down the supply chain.
Yeah and in that case like the way that you're describing this
right now let's say of course aningredient company may not be in
the best position. To talk to the farmers at the
beginning of the supply chain. So in this case actually the
responsibility, maybe also lies a step before that one, or two
(21:07):
steps before that with the localcooperatives like, somewhere in
this supply chain, there there is the point at which things can
only be sold for 25 cents per kilo and that pushes down all of
the prices beforehand and he waseven arguing even fair trade.
It's better. But it's not not guaranteeing a
(21:30):
good income for Farmers even as a midsize company, it's not that
easy to buy all the pepper as fair trade quality.
But if you would want to improvethe livelihood of farmers as an
ingredients company, right? Is there a way to do it?
Oh God. Marina.
That's a very challenging question.
I really, I'm, I'm I'm very muchdriven by our responsibility in
(21:54):
our supply chain in the selection and it's quite
challenging and And I got to give you an example, we had we
were drafting a project and Cambodia where we were trying to
work with about 100 Farmers thatwere growing pepper.
And the idea was basically, theywould have been able to supply
us seven to eight percent of thepepper.
Volume v by a year, and the basic idea is guys, we can see
(22:16):
that the fluctuating pepper price is an issue for all of us.
It's an issue for you because sometimes it goes below your
production cost. Sometimes, it's about flea
production costs, and our job isto supply.
We are selling Security in regard of price, stability, and
product quality and obviously the fibers were very happy.
(22:36):
When we said, okay, let's we agree on a sale price.
We know your production costs, we know you want to have a
profit and if you see the highest price and lowest price
aside, let's meet in the middle.That's a fair price for all of
us. We can put that into the market
arguing. That is a more sustainable
better price for all of us and the Co-operative, they basically
said to us. Oh yeah.
(22:57):
We're More than happy to sell our products for.
Let's say that. I'm going to take a number
seven, euros to kilogram. But if the price goes above the
seven euros, we're going to sellon the open market.
So we weren't able to find a solution and agreement where we
had a kind of a security and they had security, but basically
(23:19):
they wanted to have a stable price as long as we were cutting
their loss, but as soon as they would have made a higher profit,
we would have been out of the game.
And I know several examples of these kind of attitude of
farmers and I know we're not talking about the poor farm in
India that has two trees and this hardly surviving, even the
farmer side, it's profit-driven.They grow fruit because they
(23:41):
want to make a proper audit which is absolutely okay.
And but the system, there's again, I think he over
simplified with some of the solutions and you actually need
to go deeper and find a solutionon the different levels of the
food system. And I think we should rather
work for the farmers to to enable them to transition in
different fields. Limiting, the supply of the
(24:01):
market by that, increasing the price for the products and being
traded and have a more sustainable set up.
The, I don't think that even if you Would industrialize
everything to a point where you have these large-scale Farms
which have a little bit more leverage.
Still the difference. Agree with right now.
In Europe, it's like 3.2 millionFarmers to 8600 manufacturers
(24:27):
and of course, different steps in between, right?
But still such a vast steppe. So I think Farmers by
definition, it is rather small scale specialized business and
so there needs to be It is set up of the system that just make
sure that they're doing better than on the completely open
market nikhil somebody from our team, told me like it just a
(24:50):
couple of years ago, the Indian government was thinking about
changing the system. So they had these local markets
organized by the government, where the farmers could sell
their produce for fixed price. And then the Indian government
was thinking, oh, maybe we just open it up.
So the farmers can work directlywith the manufacturers.
(25:10):
And Distributors and the farmersrevolted big time because they
said no, we don't want to deal with the big corporations.
We are afraid that they end the beginning will give us better
prices and then long-term. Go back to pushing us down and
exploiting us, but I think most of the time who benefits from
the system. A lot is the corporation,
(25:32):
because if they want weed, they can go to your Ukraine.
They can get it from Germany. They can Source it from the US.
So they have all of these different Jen's and if there's
issue here or there's a cheaper price there, they don't take on
any of the responsibility. I think retailers are Traders
for agriculture products or industry companies that can
(25:52):
change a lot quicker than a farmer.
On the other side who is bound in his education, his land, the
wave set up the land the way of set up the plant, the Machinery
has bought the Farm Workers. He trained, he's bound with a
time lag to certain system. Um, to a certain product and
it's true that brings him in a bad negotiation position.
(26:15):
Here's another quote from the book to add to this point.
If you know that you're going toget low prices, you can plan you
can switch to grow something else for example.
Yet one of the greatest ironies in the shift towards markets and
food is that by joining the World Market Farmers, have lost
the very thing that justifies faith in the markets efficiency
(26:37):
price signals. Having some kind of stability in
terms of how much money you get for your products.
I continued coding, particularlyin the global self trade
liberalization has rarely been accompanied by working
mechanisms to redistribute, its gains to the poor here again.
(26:58):
We see Raj, Patel has a very Global Perspective.
He has a strong focus on the poor, which arguably is often
left out too much, right? And he's very egalitarian in his
arguments. It points at the issue that
we're just in general lacking transparency in the food system,
(27:19):
for sure. And that's an issue that also
multinationals have, and if theytry to trace back where they
have their products from, so we cannot come up with a solution
to it right now and that's the most.
Okay. We're just debating.
Like what discipline isn't trying?
I think yes, there's an unfairness disbalance.
In where the Prophet ends up. And we're not, and I rather
(27:43):
criticized him in the way you were setting up the whole story
in the book. Then denying, there was an
issue. I think it would be really funny
to have a call with him. Oh God, Roger a rush.
If you hear that and you alreadyhave your hands up in your head
(28:04):
and say, oh my God, didn't have not understood a word and what
morons are they just give us a And more than happy happy to
have a discussion. As you can see, we're quite
funny and controversial discussions.
So could be interesting. We have opinions that we haven't
been that. If you know, anyone who would
(28:27):
appreciate talking about the meta topics in the food
industry, to ask the beak and tough meta questions, it would
help a lot if you just take 20 seconds.
To simply forward them, a link to this episode, a big thank you
to the entire team, especially Celeste Gupta and the lady Karim
104, audio editing. Until next time, let's move the
(28:49):
food industry from harmful to healthy from polluting to
sustainable from red to Green.
I've been confronted with my owntruths here and more than once I
had to put down the book and think about why do I feel
uncomfortable in the way? He's putting the story, Welcome
to our season called booked arcsin the first two episodes, we
will cover the book stuffed and starved, the hidden battle for
(00:20):
our world's food system. The author vigy for Raj Patel is
a British Indian academic journalists and activists he
Holds a PhD in development sociology from Cornell
University in this book. He focuses a lot on the
inequality of our food system. The main thesis of the book is
(00:40):
that there are more people who are overweight than people who
are starving. And that solving the issues in
our food system is not just about increasing yield, and it's
much, more poverty and distribution issue.
I'm joined by my amazing co-hostFrank cunha in this thing.
Season and he's the managing partner of the adult bird wraps
(01:03):
Foundation which offers grants for scientific research in food
technology. But more on that later, let's
Jump Right In Red to Green is the most in-depth podcast on
food sustainability. And in this season 7 we discuss
key takeaways from books on the food system, I'm your host
(01:24):
Marina Schmidt and I'm joined bymy co-host, Frank Keenan?
So I think the way that Rush Hotel describes it is he looks
at it. Historically, he also breaks it
Down based on who is to blame ornot even who's to blame.
But what are the issues in the current system and then
(01:45):
therefore like who has the most responsibility to fix it?
So one of his Central themes is,of course multinationals and the
liberalization of the markets caused a lot of issues.
The first thesis is Our food system is an hourglass shaped
food system and that is an issue.
So he has this overview where heshows, Netherlands, Germany,
(02:08):
France, UK Austrian Belgium, andwhat their food supply chain
looks like. If you look at how many players
are each step of the supply chain and then it's over 3
million farmers, and producers and becomes smaller and smaller
less suppliers, even less manufacturers.
Only Manufacturers. The overview from the book is
(02:31):
actually from data ranging from 2000 to 2007.
So I wouldn't put too much emphasis on the actual numbers.
It's more about the principle and just having that in mind,
that we have a lot of farmers atthe top of the Hour Glass shape.
Then it becomes thin when we look at the middle stage of the
(02:52):
supply chain. So that means manufacturers and
retailers, especially and then as it keeps going Ying it
broadens again. When we look at the actual
consumer base, where it becomes the widest and then there are
only 110 buying desks. I actually double-check like
what that exactly means. So yeah.
(03:14):
What is it? You were wondering.
Yes, wondering do I never have it?
The term and I've been working the food industry for the last
20 years old. What is a buying desk in Europe?
Tell me? Yeah, exactly.
He also didn't explain that. The Retailer's, they give the
power to agencies. You're responsible for
purchasing. So, there are 110 buying desks
or agencies that make decisions about what to purchase, but I
(03:37):
think he simplifies too much. And from all my experience, I
never actually talked to a buying desk.
I always been negotiating directly with the retailers.
So you're invited to come to theadministration office to
Purchasing Office and you have tough negotiations with them
about the product, you want to sell to them, or the product
they want to buy from you. And I think, What he means is an
(04:00):
hour. Actually, not quite sure if that
is actually sorry. True.
I would different between and process agriculture products
like vegetables or plants that we eat and then there's packed
food and just processed food andit's frozen food in Saunders.
So I think perhaps and then might be true.
Agricultural products are boughtby buying desk but the majority
(04:21):
of products are bought directly from retailer.
They have the purchasing power. Why should they go directly via
a buying desk? I think this hour.
Glass shape is very catchy and even if you take out the buying
desks, right, you removed them. Okay, let's go.
Okay, let's remove the - where the thin part of the our glasses
where the sand kernel of sustainability has to press
(04:42):
itself. Through is the supermarket's the
Retailer's is there. Only 600 retailer chains and
connected. You know to the book, the carbon
footprint of everything we were discussing.
Oh we know are fried is a bad getting your food from heated.
(05:02):
Greenhouses is horrible for the environment but the consumer
cannot have a decision. That is balanced because it's
not on the labels, not on a label.
If the retailer is, would say wecan just decide we're not going
to buy and sell foods that have such a high CO2 emission, that's
(05:23):
unnecessary. Then that wouldn't be even an
issue. But of course then you rely On
the retailer sustainability goals and also would I think
he's pointing at is the entire system, the liberal market
system, just incentivizes everybody to just go for a
profit as the only bottom line. I think in the book, The
(05:44):
Hourglass example is like one ofthese things where I can say
there is some truth in it. And, and I think he's right when
he says, what is the purpose of the food system?
The purpose of the food system, Is not to feed us but we do it
for a profit. He basically he blames the
industry and the Traders and thepoliticians for setting up a
(06:08):
richt game. Yeah.
Because actually, his thesis is the market liberalization and
the building of multinationals was argued, based on.
We need this to make it cheaper for the consumers.
He argues that that isn't actually always the case.
So there isn't a very Interesting explanation of
(06:30):
NAFTA. So I will quote him again here
to give you a bit of the Viewpoint of Raj.
Patel the North American Free Trade Agreement and economic
Union between Mexico and the United States.
And Canada was the mother of allthree trade agreements.
And it was the first to mesh to rich countries with
significantly poorer, one for the majority of poor Farmers
(06:53):
NAFTA, hit heart the price at which you as Farmers sold their
Corn was much lower than the cost to produce it in 2002.
For instance us corn costs about$1 70 per bushel to buy boots to
Dollar sixty for us Farmers to produce.
And this is because of subsidiesfor Machinery, fertilizer credit
(07:17):
and transport that the u.s. is giving and quoting.
Raj Patel, when the price of corn, fell one would have
thought the price of tortilla would have also dropped, but it
didn't it. Fleece or price.
Rise as NAFTA, began January 1994, the average price for a
kilo of tortillas was around 50 pesos by the end of the century,
(07:39):
the price was seven times higher.
But why is that the case? And Rush argues in the tortilla
Market, the number of food processors is very small indeed
to the players, giemsa and mincyactually sound like cheeky
siblings. You know like them together.
They control 97 percent of the industrial corn flower market.
(08:02):
Remember this is a bit of an oldbook so maybe that the specific
numbers aren't as up-to-date. He summarizes the market through
competition of supposed to bringincreased inefficiency and lower
prices, but the effect of turning food production over to
the market, has been to produce less competition and offer more
structural power to the largest companies during the
(08:25):
demonstrations regarding NAFTA. It was announced that Subsidy
for every head of the EU. Cattle was more per day than the
income of three Mexican Farmers.I just found that quite yeah,
quite startling how intense the subsidies are few.
(08:46):
Also compare them on a global scale.
So I thought about this as I could duel expansion of power,
the larger you are as a multinational, the more power
you have just like Amazon, does it right to increase your prices
at some point and then also to push down the prices on the
supplier side. And the thing that I do like
(09:09):
about his focus is that, he talks a lot about what it means
for farmers and how the system is becoming increasingly
unstable. Because there used to be a time
where if you have a local market, you can sort of rely on
there being a need for. Kind of food product, but
(09:29):
nowadays, like a farmer who is growing soy or wheat with the
question of what kind of price you will be able to get for his
crop is so impossible to predictbecause the war in Ukraine and
increasing subsidies in the US or have an impact on the local
farmer. I think that there were so many
(09:50):
things you just said I would like to come back.
Yeah I what I learned again is I'm not a politician, I'm not an
idiot. Additional scientists
understanding the rules and lawsof How It's tution reacts, like
I'm really missing some background information here, it
makes sense to do a little detour and actually explain who
(10:10):
is Frank. Frank has two main positions,
one of them, being the chief of Advisory board at wraps game
behalf. It's a natural ingredients
company in the south of Germany and they are processing herbs
and spices but probably most of his time goes into working for
the adult bear traps. Station, which funds applied
(10:31):
scientific research. For example, they also work with
startups and they fund academic research related to all the
proteins. I've sought to work for the
foundation eight years ago, basically, I'm the managing
director or the managing partnerof the foundation and to clarify
how this is related wraps. The spice company is actually
(10:51):
funding the foundation. The very interesting story, we
never actually talked about thatover the last four decades.
It's roughly 25 percent of the profit of the family.
Business goes into the foundation and then the spent by
the foundation, controlled by the Bavarian government back
into the society for any kind ofprojects.
It's a really great example of acompany that is donating a lot
(11:13):
back to society. You can find out more about the
foundation by Googling the adultbird wraps Foundation.
You can also follow the link in the show notes.
Possibly, you, or somebody, you know, could actually apply for
research. There.
And with that, we can go back into discussing Rush Patel's
criticism how price develops along the supply chain.
(11:37):
So it's more my experience on the industry and working with
industry and reading some books on these topics.
From what I understood is that is a rigged game as well because
it's not freedom of the market, we are blocking out African
Farmers from the European market.
In the same time we allow European products to flow freely
into the African market and buy that disturbing the whole Local
(11:58):
market that's something which isout of my perspective, not
freedom of the market that's already been manipulated in a
way. There's a flaw in the system
again, but that doesn't mean theliberalization of the market is
wrong. So, I think that the main one is
also that the US UK, Japan and Germany like all the
(12:19):
industrialized nations actually did something different.
We have loads of subsidies for our farmers and lots of support
for farmers. And the same time, these
Contracts disallow it in the global South.
So Raj Patel mentions that in the end of the 1970s, the World
Bank was one of the few organizations that had both the
(12:42):
means and the will to extend credit to governments in the
global South and there was all connected to many countries
being close to bankruptcy and they needed money.
So the bank made loans availablebut it did.
So only if certain conditions were met it and those included
is sweet of changes. In the economy, the most
important part is that domestic support the actual support
(13:05):
system for Farmers was dismantled.
So farmers did not have any guarantee Market or minimum
price for their goods. All of that would be dismantled.
Yeah, I agree. And that's what I was trying to
say that on that level on trade level where institutions and
governments agree upon certain terms how they do trade the
(13:26):
system is Not well, balanced there, I can query.
And that's something where we were.
The focus should be on how to improve these systems.
He actually proposed this kind of more complex farmer system
where you have local farmers with it.
I don't know how big a good Farmis but where he has a farm that
(13:48):
is self-sustainable delivering to certain amount of people
around him. The food they can eat, they not
want it, but what you has this system?
On the other level is under risk.
A lot more because you have a Draught, you have a storm, the
yield is gone, there's no Harvest.
Then suddenly the whole local region is out of food and more
(14:11):
Global Food system is able to balance these kind of needs
depending where it comes from this, don't worry, you have
difficult rain season in Vietnam, you're lacking rise.
We can balance that out because there's more rice being grown
and give me a country which is growing rice.
Vietnam, China and China. Let's call it a day.
(14:31):
They basically do everything here.
I am rather more Pro scaling up Farms than contrast, getting up
Farms. I agree with you that scale also
means efficiency. So if people are in general
against industrial large-scale, agriculture, I think there is
also a benefit, right? To every kind of problem that we
(14:52):
have, we need a variety of solutions.
We can benefit in the mix of solutions from regenerative,
huh? Agriculture to improve soil
health. And we can also use community
supported agriculture which leads to Farmers.
Actually, having a good income in the last episode of our food
waste season. I actually talked to a farmer
who is doing community supportedagriculture in New York and she
(15:16):
also diversifies her crops. So she is growing aubergines and
tomatoes, and zucchini, and everything.
And if one thing doesn't work out, then she still has several
different. UPS to work with and the people
agree that while they will take whatever happens to be in
season. That here, agree, like standing
(15:37):
on Thousand Foods is more stablethan standing on one foot.
Yeah, let's say the base issue is that retailers are pushing
the prices for most Farmers to alevel that just doesn't even
allow them to live off of their farming.
Yeah. So the food system from my point
of view. It was because it's profitable.
(15:58):
For driven and scale driven fromsmall entities towards a bigger
business bigger farm system and I was wondering if we would have
a similar discussion when we're looking into the mobility
industry and the change from horse powered cars to real cars
or combustion engine powered cars they disappeared.
(16:19):
Like I was wondering course, it's weird talking about food if
we're looking into the past said, oh it's such a great pass.
We need to keep the farmers up or if you need to let it go.
And said, there's a new development in town.
I'll Food Systems and industrialized food system.
There is no space for small farmers.
Let's make sure they transition to the different job, a
different setup, then trying to keep them in a system, which is
(16:43):
not sustainable for them. Did you see what I mean?
Is I'm not quite sure if we're holding onto a picture of the
past here. Go back 150 years into the
European or the German setup of the farmers and then ask a
family. That was Running a farm at that
times, if they would have want to keep on going or if they
(17:03):
wanted to be industrialized good, it would have said that
isn't an issue that only affectssmall farmers because he also
describes how the liberalizationin terms of NAFTA between the US
market. And the Mexican market led to
huge maze producers, having massive issues because the maze
from Mexico was competing with heavily subsidized corn and
(17:26):
Maize from the US. So the issues of course are we
going to revert liberalization of the market?
No, I think it's just a matter of being aware of that.
So in this case, we need to understand the system as it is,
and it is not fair. There are subsidies like for
example, this their subsidies inGermany for cow's milk
(17:47):
production. I don't think on some drugs
millions and I was thinking today like is my old milk
subsidized. Why do I pay tube?
254 freaking out. Milk, appreciate it.
But what I want is not as happily.
But what I wanted to point out the own experience in the
agriculture business, I have is some hubs and farms and I've
(18:10):
been to big companies growing inhuge volume pepper.
And I've been to not make farmers in India where family
business is basically growing upMax and harvesting the and if
you talk to those families and if you talk to those Farmers,
they don't want to be a farmer, they want.
The biggest issue for us as a spice company or spices and
(18:32):
seasoning company is in regard of sustainability.
Roughly, we're talking to 1.5 million Farmers worldwide,
growing pepper, cumin ginger garlic, cinnamon, whatever,
clothes, whatever, you can thinkof.
I'm not able even if I want to have a certain sustainable
standards. I can't push them through the
(18:52):
system to the farmers. I can't talk as a midsize
company to 1.5 million. A farmer's.
It's a lot easier to set up a discussion about our
sustainability goals with a bigger player like allam who's
growing pepper in Vietnam. It's so the solution is just
something I wanted to highlight that.
I think there are disadvantages with this kind of local farmer
(19:17):
midsize sustainable. And we're not only talking about
the farmers in the United Statesand in Europe and we're talking
about farmers in Africa that have a small plot of land.
They have two goats And they barely survived from what they
grow at a very idealistic picture, sometimes of the farmer
being so sustained, you gave me an idea here.
(19:37):
So what I find so fascinating, when we did the food waste
season, if you look at the breakdowns, two to three percent
of the food waste along the supply chain is caused by
retailers and like in France they had the regulation that
it's a necessity for retailers to they are obliged to pass it
on but oftentimes they pass on Yellow broccoli like something
(19:59):
that's already not eatable. Okay.
Maybe this needs a little bit more explanation.
So in France it has become obligatory for grocery stores to
donate their leftover food and one issue that came up with that
is that sometimes retailers would donate it.
We too late. So donate yellow broccoli.
(20:22):
But the thing is that once it's donated, whether it's eaten or
not retailers, can Check it off their books, they don't need to
account for the food waste if they have passed it on in some
kind of fashion. So to me, it's always the
question who has the power who has the ability to negotiate,
the strongest, who has the ability to divert both risk and
(20:47):
responsibility up and down the supply chain.
Yeah and in that case like the way that you're describing this
right now let's say of course aningredient company may not be in
the best position. To talk to the farmers at the
beginning of the supply chain. So in this case actually the
responsibility, maybe also lies a step before that one, or two
(21:07):
steps before that with the localcooperatives like, somewhere in
this supply chain, there there is the point at which things can
only be sold for 25 cents per kilo and that pushes down all of
the prices beforehand and he waseven arguing even fair trade.
It's better. But it's not not guaranteeing a
(21:30):
good income for Farmers even as a midsize company, it's not that
easy to buy all the pepper as fair trade quality.
But if you would want to improvethe livelihood of farmers as an
ingredients company, right? Is there a way to do it?
Oh God. Marina.
That's a very challenging question.
I really, I'm, I'm I'm very muchdriven by our responsibility in
(21:54):
our supply chain in the selection and it's quite
challenging and And I got to give you an example, we had we
were drafting a project and Cambodia where we were trying to
work with about 100 Farmers thatwere growing pepper.
And the idea was basically, theywould have been able to supply
us seven to eight percent of thepepper.
Volume v by a year, and the basic idea is guys, we can see
(22:16):
that the fluctuating pepper price is an issue for all of us.
It's an issue for you because sometimes it goes below your
production cost. Sometimes, it's about flea
production costs, and our job isto supply.
We are selling Security in regard of price, stability, and
product quality and obviously the fibers were very happy.
(22:36):
When we said, okay, let's we agree on a sale price.
We know your production costs, we know you want to have a
profit and if you see the highest price and lowest price
aside, let's meet in the middle.That's a fair price for all of
us. We can put that into the market
arguing. That is a more sustainable
better price for all of us and the Co-operative, they basically
said to us. Oh yeah.
(22:57):
We're More than happy to sell our products for.
Let's say that. I'm going to take a number
seven, euros to kilogram. But if the price goes above the
seven euros, we're going to sellon the open market.
So we weren't able to find a solution and agreement where we
had a kind of a security and they had security, but basically
(23:19):
they wanted to have a stable price as long as we were cutting
their loss, but as soon as they would have made a higher profit,
we would have been out of the game.
And I know several examples of these kind of attitude of
farmers and I know we're not talking about the poor farm in
India that has two trees and this hardly surviving, even the
farmer side, it's profit-driven.They grow fruit because they
(23:41):
want to make a proper audit which is absolutely okay.
And but the system, there's again, I think he over
simplified with some of the solutions and you actually need
to go deeper and find a solutionon the different levels of the
food system. And I think we should rather
work for the farmers to to enable them to transition in
different fields. Limiting, the supply of the
(24:01):
market by that, increasing the price for the products and being
traded and have a more sustainable set up.
The, I don't think that even if you Would industrialize
everything to a point where you have these large-scale Farms
which have a little bit more leverage.
Still the difference. Agree with right now.
In Europe, it's like 3.2 millionFarmers to 8600 manufacturers
(24:27):
and of course, different steps in between, right?
But still such a vast steppe. So I think Farmers by
definition, it is rather small scale specialized business and
so there needs to be It is set up of the system that just make
sure that they're doing better than on the completely open
market nikhil somebody from our team, told me like it just a
(24:50):
couple of years ago, the Indian government was thinking about
changing the system. So they had these local markets
organized by the government, where the farmers could sell
their produce for fixed price. And then the Indian government
was thinking, oh, maybe we just open it up.
So the farmers can work directlywith the manufacturers.
(25:10):
And Distributors and the farmersrevolted big time because they
said no, we don't want to deal with the big corporations.
We are afraid that they end the beginning will give us better
prices and then long-term. Go back to pushing us down and
exploiting us, but I think most of the time who benefits from
the system. A lot is the corporation,
(25:32):
because if they want weed, they can go to your Ukraine.
They can get it from Germany. They can Source it from the US.
So they have all of these different Jen's and if there's
issue here or there's a cheaper price there, they don't take on
any of the responsibility. I think retailers are Traders
for agriculture products or industry companies that can
(25:52):
change a lot quicker than a farmer.
On the other side who is bound in his education, his land, the
wave set up the land the way of set up the plant, the Machinery
has bought the Farm Workers. He trained, he's bound with a
time lag to certain system. Um, to a certain product and
it's true that brings him in a bad negotiation position.
(26:15):
Here's another quote from the book to add to this point.
If you know that you're going toget low prices, you can plan you
can switch to grow something else for example.
Yet one of the greatest ironies in the shift towards markets and
food is that by joining the World Market Farmers, have lost
the very thing that justifies faith in the markets efficiency
(26:37):
price signals. Having some kind of stability in
terms of how much money you get for your products.
I continued coding, particularlyin the global self trade
liberalization has rarely been accompanied by working
mechanisms to redistribute, its gains to the poor here again.
(26:58):
We see Raj, Patel has a very Global Perspective.
He has a strong focus on the poor, which arguably is often
left out too much, right? And he's very egalitarian in his
arguments. It points at the issue that
we're just in general lacking transparency in the food system,
(27:19):
for sure. And that's an issue that also
multinationals have, and if theytry to trace back where they
have their products from, so we cannot come up with a solution
to it right now and that's the most.
Okay. We're just debating.
Like what discipline isn't trying?
I think yes, there's an unfairness disbalance.
In where the Prophet ends up. And we're not, and I rather
(27:43):
criticized him in the way you were setting up the whole story
in the book. Then denying, there was an
issue. I think it would be really funny
to have a call with him. Oh God, Roger a rush.
If you hear that and you alreadyhave your hands up in your head
(28:04):
and say, oh my God, didn't have not understood a word and what
morons are they just give us a And more than happy happy to
have a discussion. As you can see, we're quite
funny and controversial discussions.
So could be interesting. We have opinions that we haven't
been that. If you know, anyone who would
(28:27):
appreciate talking about the meta topics in the food
industry, to ask the beak and tough meta questions, it would
help a lot if you just take 20 seconds.
To simply forward them, a link to this episode, a big thank you
to the entire team, especially Celeste Gupta and the lady Karim
104, audio editing. Until next time, let's move the
(28:49):
food industry from harmful to healthy from polluting to
sustainable from red to Green.
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