There is no neutral market

People are gradually accepting that a healthy body requires healthy food produced in a regenerative farming system. But most tend to forget that this healthy relationship needs to be expressed through regenerative relationships between producers and consumers.

In the dominating narrative, The market is a neutral and disinterested institution where consumers meet producers and demand meet supply. In this view, the market can be filled with any content as long as there is a demand from consumers. If consumers want high quality regional food, or organic, or halal, or fairly traded it will in some way materialize and be supplied. Or conversely, if you are a small scale producer with diversified production, there is always an opportunity there in the market place. If you fail, it is just because you weren’t ingenious enough.

So the story goes. But is this really a correct description of The market? 

Banana market in Samoa

Of course not, the market is neither neutral nor disengaged. To begin with there is normally not one market, there are many different markets which fulfil different needs.  At the same time that there is a large wholesale market for food, servicing major food retailers, there can be a smaller market for farmers selling directly to small shops and yet another one for farmers who sell directly to consumers.  And each one of these markets serves different needs both on the supply and the demand side.

If you have a large farm with one or two crops you will not sell your crops with direct marketing but will be bound to large wholesale markets or being a supplier to a food, feed or biofuel industry. This also means that you will fine-tune your production according to that buyer’s demand. This will direct your choice of variety, the fertilization strategy, the time of sowing and harvesting. All in all there is a need for strict coherence between your production and the kind of market you are aiming at.

In a similar way, if you have a diverse farm with a mix of animals and plants it is highly unlikely that you can be a successful supplier to the same kind of markets. Your quantities are too small for shipping, you lack the right seed cleaner or packing technology for each of the crops, or your quality is another than demanded. So you are de facto locked out from the main market. If your farm is located close to a population center you might be able to sell your produce to affluent consumers directly or to a shop targeting those. But, even here, you will constantly be driven towards less diversity and more standardization. Your best bet if you want to keep the diversity is to become an educational farm or some kind of community supported farm. This can also be observed in all affluent countries.

If we bring the discussion even further, if you farm primarily to produce food for your family and only try to sell a surplus you will find that you are not a very interesting partner in any markets. Your supply is inconsistent, your priority is the food of the family and not of the client, and you don’t have the logistic machinery for bringing your stuff to the market. Therefore if you at all can sell, it is most likely to a middleman of some sort, who will pay you very badly. This can also be observed in most developing countries today.

The globalized food market with increasing dominance of a few retailers, a handful of food industries and wholesalers and very few input suppliers is not conducive for many kinds of producers, regardless of if there is a theoretical or potential consumer demand for their produce.

This makes it apparent that “markets” in no way are neutral towards producers and consumers. On contrary, they are based on certain types of production (and producers) and and certain types of consumption (and consumers). It is simply not true that “consumer demand” will create markets for organic, high quality, artisan regional food within the dominant market structures. Or if they do, the market will pervert the production and consumption to fit in.

This makes it quite easy to understand why the “market forces” are pushing also organic farmers in to larger scale and less diversity. As I write in Global Eating Disorder:

A study of ten organic farms in Denmark show that they too have to focus excessively on short term profits and ever-changing market requirements and have little time, energy or money to develop their farming system into a more ecologically sound system…. This experience is echoed in England and Germany. A German organic farmer explains: ‘in the beginning I carried out experimental cultivation of heritage grain varieties. But then I gave up everything that didn’t bring in money, because when the business is in the red it doesn’t make much sense’.

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This insight makes it pertinent to discuss which kind of market that is conducive for which kind of production and vice versa. An attempt to do just that was made by the FAO in a seminar in Rome 8-9 June 2016, Sustainable value chains for sustainable food systems. The workshop report contains a lot of interesting papers on various form of “marketing”, including a paper on food self-provisioning in Hungary, i.e. clearly a non-market solution.

The paper What types of markets to support agroecology, by Maryam Rahmanian, Jimena Gomez, Lorenzo Banno and Alexandre Meybeck describes four types of solutions; producer organizations, public procurement programmes, participatory guarantee systems (PGS) and community supported agriculture (CSA). The paper questions if formal global markets can support the ecological, social and economic conditions needed for an ecological production system.

The authors also note that there is a need to consider how consumer diets are affected by the market system. I believe this is a very important conclusion. There are many observations on how our modern food system has changed the diet of the population. For instance, it is gradually recognized how the diversity in soils and farms might be reflected in the gut, and how the lack of that diversity makes people sick. 

People are gradually accepting that a healthy body requires healthy food produced in a regenerative farming system. But most tend to forget that this healthy relationship needs to be expressed through regenerative relationships between producers and consumers. Some of those relationships will perhaps be new forms of markets, but I think most of them will be non-market relationships. 

While I still don't have the full "theory" developed it seems to me that any form of "market" will be based on competition and division between producers and a certain degree of exploitation. None of these are conducive for sustainable and regenerative relationships.

Towards a new narrative of food

To let commodity markets shape our diets and the stewardship of the land is a bad idea. This can clearly be seen both in nature, societies and human bodies. Most of the emerging food movements are based on other perspectives. The food system as commons emerge as a competing narrative to food as commodity.

The market paradigm clearly dominates how food and agriculture is discussed. For many people it goes without discussion or reflection that food is a commodity – a product with the main purpose to be sold by the producer and through various middle-men be bought by the end user, the consumer. It is evident because that is how we discuss food in the public sphere. It is evident for the consumers because of how food is presented in shops: “buy this” “2 for the price of 1”. It is evident for the farmers who are told to produce what is demanded by the market and who suffer when world market prices plummet, totally out of her their control.

But if you think about food once more, it is easy to discern many situations where we don’t look upon food as a commodity. The first food most humans eat is willingly given for free by a mother offering her breast. When we cook food for friends or family we do it outside of the market framework even if we have bought the food. The same apply when we grow food ourselves and share our bounty with a neighbour. Growing and cooking are hobbies and relaxing leisure for many, a duty without pay for others. Many foods also have cultural (or religious) meanings which transcend any market perspective.

Ulitmately, access to food is also an inalienable right. This was already agreed by world leaders in the Universal Declaration of Human Rights. It has been re-asserted ever since, for example at the 2009 World Summit on Food Security in Rome. The Special Rappor­teur on the Right to Food for the United Nations, Olivier De Schutter, writes in the report to the General Assembly in August 2013: ‘The right to food has come to the fore as Governments realize that their efforts to combat food insecurity and hunger have been failing and realize the urgent need to strengthen national legal, institutional and policy frameworks’.[i]

The market is a mechanism for distribution of food. But it doesn’t work very well. To begin with, there are almost a billion people hungry – clearly the market fails to supply them with food. Further, there are huge external costs involved in food production, costs which are not reflected in the price of food. Through competition, farmers are forced, or encouraged, to externalise as much as possible of these costs. Commodification thereby promotes a perverse system.

Food processors and traders make most money from making people buy food made from cheap raw materials (corn, soy, wheat, sugar, palm oil etc.) which at the same time have a big appeal to consumers. Fat, salt and sweet are keywords. The marketing is so efficient that people buy far too much, leading to both obesity and waste.

In addition, farming has more functions than the production of food. More than half of the biological production in the terrestrial systems of the Earth is taking place in the agriculture landscapes and the management of those agricultural landscapes is our most important tool for managing nature, a nature that we are totally dependent on even in these modern times.   

But the signals, the guidance, from commodity markets don’t promote good stewardship of the land. They promote specialization, larger scale, monoculture, externalization of costs and short term profit over longer term sustainability. The reality is thus a lot more complex than the narrative of food as a commodity makes us believe. To let commodity markets shape our diets and the stewardship of the land is simply a bad idea.

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Even if it sounds far-fetched, perhaps even frightening for some, there is a growing energy into a food system based on other perspectives than the one of the commodity. This can be seen “in the field” with many initiatives for new food systems relationships, such as community gardens, community supported agriculture, relationship food* etc. 

The food system as commons, a shared interest and shared responsibility, emerge as a competing narrative to food as commodity. This doesn’t rule out markets as one of several mechanisms for food distribu­tion, but does it reject market hegemony over our food supplies and their distribution. It also rejects the view that market forces and private ownership are the best ways for allocating food producing resources, such as land, water, knowledge and seeds.

Rethinking food as a right, farming as a management system of the planet and the food system as a commons also necessitates the building of new institutions fit for these purposes. That includes both new relationships between producers and consumers and public institutions and policies. But I leave that discussion to another time. 

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There is also an emerging academic interest in new perspectives on food. Jose Luis Vivero Pol, a food governance researcher, has made an interesting analysis of academic papers in The value-based narrative of food as a commons. A content analysis of academic papers with historical insights.  His analysis of English academic texts reveals that “food commons” or “food public good” topics are very marginal subjects in the academic milieu with only 179 results since 1900, but with sharp increase in the eight years that followed the 2008 food crisis. On the contrary, “food commodity” presents almost 50,000 references since 1900.

Vivero Pol, Tomaso Ferrando, Olivier de Schutter and Ugo Mattei, are now editing the Routledge Handbook of Food as Commons. It will present a different normative view of food as a commons instead of a commodity and “how the food system would change if food was regarded and enacted as a commons.“ The title will be published in 2018 and I am looking forward to reading it.

I have written myself on this theme, in my book Global Eating Disorder and more specifically in the article Food: From Commodity to Commons. In that article I write:

”The market is not a good master for a sustainable food system. Instead we need to find new ways of managing the food system based on food as a right and farming as a management system of the planet Earth. The solutions should be based on relocalization of food production and de-commodification of food and our symbionts, the plants and animals we eat.”

There are interesting times ahead.

* Relationsmat, “relationship food” is a term used in Swedish to emphasise the  need to form new relationhips between the actors in the food chain, systems of co-production of cooperation.

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[i]            United Nations General Assembly 2013 The Right to Food, Interim report of the Special Rapporteur on the Right to Food, 7 August 2013, A/68/288