Food Chain

Towards Sustainable Food Chain
Concept and Challenges

(Case study the dairy food chain in Poland)
Professor Micha Sznajder

Department of Agrifood Economics
Agricultural University of Pozna
Poland
Brussels 7.12.2006
Presentation outline
1.
2.
3.
4.
5.
6.
7.
8.
Definition of the food chain

Classical economy and sustainability
Sustainable food chain
The goals of the sustainable food chain
Macroeconomic and microeconomic approach to sustainable food
chain
Econometric models for developing sustainability in the food chain
Lifestyle as the keystone combining all available paths of subbranch food chains
The Polish national dairy food chain
Definition of the food chain
Scientists approach to the food chain: Energy flows from one organism to
another - when eaten - to sustain particular organisms life.
Economists approach to the food chain: They dont ignore the above
approach, but obviously they relate it to the human, conscious activity of food
production and consumption.
Links of the food chain: The food chain may consist of several links:
food
production
assembling
(collection)
processing
storage
trading
purchase of
food
Raw agricultural products while moving through the food chain are processed,
packed, merchandised and finally consumed.
Classical, liberal economists toward sustainability
Economists expect that the food chain has to provide maximum return
on the capital invested in the chain.
Environmental and social issues are considered as limiting factors or
constraints.
The dispute over the way to include ecological, environmental and
social aspects in economic models, calculations and considerations has
always been very important.
Conclusion:
The concept of sustainability may enrich classical economy with
environmental and social aspects.

Sustainability and political games
Some people believe that the concept of sustainability is the UE selfdefence theory, necessary in WTO negotiations to protect the
European Model of Agriculture.
They even forecast the theory should collapse under the free market
regime.
Conclusions:
Sustainability is not necessary a tool for the political games.
Economists have discussed environmental issues for a very long time.
Maybe the concept of sustainability is the right one economists have
been looking for.
Communists doctrine of harmonious development
Communists tried to practice a kind of sustainability, hidden behind

such key words as equality and harmonious development. Neither
equality nor harmonious development has ever been achieved.
Strong backward and independent of human will processes always

created a new big inequality and disharmony.
The final result of centrally planed economy was disastrous.
We have to be aware that sustainability may trigger strong backward

processes.
Sustainable food chain
Sustainability may be linked to:

- institutions,
- economy,
- ecology.
The following three elements play a key role here:

- sustainability,
- durability,
- balance.
All these above involved in the food chain result in it sustained development.
Goals of the sustainable food chain
Food chain directed toward sustainability or considered as sustainable

must achieve environmental, nutritional, economic and social goals.
Four clusters of objectives:
A. Environmental objectives
B. Nutritional objectives
C. Economic objectives
D. Social objectives
A. Environmental objectives
1.
2.
3.
4.
5.
air pollution control

water pollution control
soil pollution control
noise pollution control
protection against radiation
B.
Nutritional objectives
1.
2.
3.
4.
5.
providing enough food for mankind

providing nutritious food (macro- and microelements)
providing safe food
providing stable food delivery
providing food in time and place required by the consumers
C.
Economic objectives
1.
2.
3.
4.
5.
achievement of equality point between supply and demand

ensuring moderate food prices
maintenance of job posts
maximization of added value
maximization of return on investment
D. Social objectives
1. ensuring a good standard of life for families of farmers, processors,
traders and all involved in the food chain
2. promotion of good interpersonal relations between people involved
in the food chain
3. promotion of good health of all food consumers
4. promotion of prolonged lifespan of all food consumers
Macroeconomic approach to sustainable food chain
Global, regional or national food chains may be considered.
The macroeconomic approach leads to the aggregate matrix of ratios

related to a state or a region.
Outcomes of the simulation on such a matrix may be useful for policymakers and academics.
Microeconomic approach to sustainable food chain
The food chain consists of several branch food chains. A particular

branch food chain may consist of several sub-branch chains.
The general Polish food chain may be split into at least in 8 major
branch food chains.
Branchfood
foodchains
chains
branch
dairy
meat
grain
sugar
potatoes
vegetable
oil
There exist dozens of individual food sub-chains; for example for

pasteurised milk, UHT milk, cheese, cottage cheese, yoghurt, and so
on.
fruit
Econometric models for developing sustainability

in the food chain
Two methods may be useful in the consideration of the sustainable food chain:
The expertise method,
The linear programming method.
In the expert method all variables, as their importance varies, might be ranked
and classified to group of stimulants, nominates and destimulants. Upper and
lower limits of each variable must be set.
The simplex method may be used to find the optimal sustainable solution for
the food chain. Modelling must be link to expert knowledge (expert method)
as it contains numerous ratios which must be proved by high quality specialists.
Econometric model leading to sustainable dairy food chain

Relations
balances
and links
Production
subscript p
Environmental
subscript e
Social
subscript s
Macroeconomic
subscript ma
Microeconomic
subscript mi
Technical ratios
subscript t
Sustain goals
for dairy food
chain
subscript g
Xp1...............Xpn
aep1..aepn
....
aepk..aepnk
asp1..aspn
....
aspk..aspnk
amap1..amapn
....
amapk..amapnk
amip1..amipn
....
amipk..amipnk
atp1..atpn
....
atpk..atpnk
agp1..agpn
....
agpk..agpnk
Assembling
subscript a
Xa1................Xan
aea1..aean
....
aeak..aeank
asa1..asan
....
asak..asank
amaa1..amaan
....
amaak..amaank
amia1..amian
....
amiak..amiank
ata1..atan
....
atak..atank
aga1..agan
....
agak..agank
Source: The authors study
Processing
subscript pr
Xpr1............Xprn
aepr1..aeprn
....
aeprk..aeprnk
aspr1..asprn
....
asprk..asprnk
amapr1..amaprn
....
amaprk..amaprnk
amipr1..amiprn
....
amiprk..amiprnk
atpr1..atprn
....
atprk..atprnk
agpr1..agprn
....
agprk..agprnk
Food chain variables

Packaging
Selling
and Storage
subscript pa
Xpa1.Xpan
aes1..aepn
....
aesk..aepnk
asp1..aspn
....
aspk..aspnk
amap1..amapn
....
amapk..amapnk
amip1..amipn
....
amipk..amipnk
atp1..atpn
....
atpk..atpnk
agp1..agpn
....
agpk..agpnk
subscript se
Xse1..Xsen
aese1..aesen
....
aesek..aesenk
asse1..assen
....
assek..assenk
amase1..amasen
....
amasek..amasenk
amise1..amisen
....
amisek..amisenk
atse1..atsen
....
atsek..atsenk
agse1..agsen
....
agsek..agsenk
Consumption
Lifestyle
Constrains
Nominats
subscript c
Xc1Xcn
aec1..aecn
....
aeck..aecnk
asc1..ascn
....
asck..ascnk
amac1..amacn
....
amack..amacnk
amic1..amicn
....
amick..amicnk
atc1..atcn
....
atck..atcnk
agc1..agcn
....
agck..agcnk
subscript l
Xl1.Xln
ael1..aeln
....
aelk..aelnk
asl1..asln
....
aslk..aslnk
amal1..amaln
....
amalk..amalnk
amil1..amiln
....
amilk..amilnk
atl1..atln
....
atlk..atlnk
agl1..agln
....
aglk..aglnk
Stimulates
Destimulates
E1
.
.
Ek
S1
.
.
Sk
Ma1
.
.
Mak
Mi1
.
.
Mik
T1
.
.
Tk
G1
.
.
Gk
Lifestyle as the keystone combining all available

paths of sub- branch food chains
For ages what mankind consumed was the result of outcomes of the food
chain.
The food chain for a major part of human history was very simple. It had
a few links:
food production in
ones own farm
preparing food from

the raw materials
consumption
at home
The second half of the 20th century gave us huge development in the food
chain. The food chain became more complicated. Several new links were
formed in the chain. Home food processing slowly disappears.
Home food processing in Poland

Vegetable products
jared peas
8,8
jared bean
16,5
33,5
jared pepper
39,9
sour cabbage
mushroom pickled in vinegar
44,5
48,9
dried mushroom
58,6
jared cucumber
Fruit products
67,1
pickled cucumber
0
10
20
30
40
50
60
70
80
11,4
fruit wine
percent of households
preserve
Source: Sznajder M., Moskalik B. (2004): Food

processing in households, Wyd. Roczniki naukowe
SERiA, Pulawy, Poland
32,1
juice
36,8
plum jam
36,9
jam
44,6
compote
61,3
0
10
20
30
40
50
60
70
Home food processing in Poland

Dairy products
4,4
melted cheese
kefir
5,4
yoghurt
5,8
butter
6,6
15,5
cottage cheese
Flour products
sour milk
23,6
0
10
15
20
25
bread, roll 4,8
pasta
27,5
64,6
cakes
Source: Sznajder M., Moskalik B. (2004): Food

processing in households, Wyd. Roczniki naukowe
SERiA, Pulawy, Poland
10
20
30
40
50
60
70
Lifestyle as the keystone combining all available

paths of sub-branch food chains
New lifestyles impose on farmers and processors a new direction of

development. The new lifestyles do not necessary initiate sustaining
response of the food sector.
Lifestyles at the moment become the keystone combining all available

paths of sub-branches of the food chains and the main driving force for
the chain development.
A big task is to promote new lifestyles promoting sustainable

development of the food chain.
The Polish national dairy sector started its activity at the turn of the 19th and
20th century.
During the communist time the Polish national dairy sector was
characterised by:
1. huge milk production - over 16 billions tons
2. huge numbers of dairy farmers - over 1.8 million
3. a big number of milking cows 6 million
4. low milk quality
5. low herd size farms
6. underdevelopment of processing plants
7. a poor assortment of dairy products available on the market
8. cooperatives dependency on communist party officials
9. unsustainable economy of dairy firms (huge subvention to dairy products)
10.unsustainable impact on the environment.
The transition of the economy from centrally planned to market one has
turned out to the sustainable model for the national dairy sector.
Poland has achieved astonishing results in the dairy sector after the collapse
of the communist system. New challenges for sustainability have appeared.
a change of system
Examples of the main economic developments

(evolutions) in the last decade in the food chain and their
impact on development toward sustainability of the chain
based on the dairy sector in Poland
No
Link of the
food chain
1 Production on
farm
Name of the
development
Yields,
productivity
maximization
Example for
dairy sector
Milk yield
Towards sustainability
Moderate milk yield 4500-5000 kg
Backwards sustainability
Maximization of very high milk

yield over 10000 kg.
Maximum extension of grazing period on Maximization of the share of

grasslands. Minimization of feeding on concentrates and other
supplements. Supplement here means all supplements in daily feed ration
kind of feeds obtained from arable lands
Milk yield increase by BSE
injections
GMO manipulations
EU milk quality standards
Animal welfare improvements
Optimization of the Heard size
Moderate number of cows on a farm -up Huge scale heard over 1000
scale of production maximization to 50- 60 cows which will ensure good cows. Reduced number of
standard of life for dairy farmer
work stands.
Quality increase
Administrative
regulation for
farms
Milk quality
Cattle density Up to 2 head per ha. Quality of

environment still under farmers control
Over 2 heads per cow. Creates

big environmental problems.
Milk quota
Maximization of milk yield and

reduction of the number of
cows
Elimination of competition between

farmers
MILK YIELD
Level of feeding
Moderate milk yield 45005000 kg
Maximization of very high

milk yield over 10000 kg
MILK YIELD
Injections
Milk yield increase by bST

(or rBST) injections
MILK YIELD
Genetics
Traditional methods of
animal breeding
GMO manipulations
CATTLE DENSITY PER HA
Up to 2 head per ha. Quality

of environment still under
farmers control
Over 2 heads per cow.

Creates big environmental
problems
MILK QUOTA
Elimination of competition
between farmers
Maximization of milk yield

and reduction of the number
of cows
No
Link of the
food chain
2 Assembling
(collection)
Name of the
development
Minimization of
assembling costs
Example for
dairy sector
Minimization elimination of farms in remote areas

of cost of milk
collection
Better standard of life of farmers

Diminishing
Number of
number of delivers dairy farm has remaining in business.
been
drastically
reduced
More people seeking for new

job opportunities. In case of
Poland from 1.8 million to 0.3
million. Further reduction to
0.1 million is expected
NUMBER OF DAIRY FARM HAS BEEN

DRASTICALLY REDUCED
Better standard of life of

farmers remaining in business
More people seeking for new

job opportunities. In case of
Poland from 1.8 million to
0.3 million. Further
reduction to 0.1 million is
expected
No
Link of the
food chain
3 Processing
Name of the
development
Changing in types
of ownership
Example for
dairy sector
Product
diversification
Transformatio Better opportunity for farmers to find a

n from
new opportunity by selling their shares.
cooperatives
to limited
liability
companies
Increase of
Cheaper waste utilization
daily
throughput of
processing
plants
new generation Better response to consumer demands
products
Efficient of
productivity
Lower costs of
production
Packaging
Advertisements
Plastic
Milk
consumption
promotion
Enlargement of
processing scale
Non producers may benefit

form milk production
Increase of waste
Over consumption
Product safety increases

Environmental problems
Milk consumption is too low. Increase of too high consumption leads to
consumption promotes human health and health problems
life
TRANSFORMATION FROM COOPERATIVES TO

LIMITED LIABILITY COMPANIES
Better opportunity for

farmers to find a new
opportunity by selling their
shares.
Nonproducers may benefit

form milk production
NEW GENERATION PRODUCTS

Better response to consumer

demands
Over consumption
ADVERTS
Milk consumption promotion
Milk consumption is too low.

Increase of consumption
promotes human health and
life
Too high consumption

leads to health problems
No
Link of the
food chain
4 Retailing
Name of the
development
Example for
dairy sector
Extending product UHT

shelf life
Entrance barriers
Tax taken by
supermarkets
to introduce
new products
or to allow
products in.
For some countries a solution may be

considered the sustainable model (in
tropics)
For well-developed countries

solution - unsustainable
Absolutely unsustained. It limits
consumer choice to that
available on shelf products
UHT
For some countries in

tropics a solution may be
considered the sustainable
model
For well-developed countries

solution - unsustainable
TAX TAKEN BY SUPERMARKETS TO INTRODUCE

NEW PRODUCTS OR TO ALLOW PRODUCTS IN
Absolutely unsustained. It
limits consumer choice to that
available on shelf products
No
Link of the
food chain
5 Consumption
Name of the
development
Example for
dairy sector
Changing patterns Reduction of

of consumption
liquid milk
consumption
Increase of
cheese
consumption
Increase in health Probiotics
concerns
Osteoporosis
Too much fat
PROBIOTICS
No
Link of the
food chain
6 Lifestyles
Name of the
development
Example for
dairy sector
New fashions
Dairy products
are not
considered
fashionable
anymore
New lifestyles
Lifestyles
promoting
sustainable
development
Unsustainable fashion
Sustainable lifestyles
Unsustainable lifestyles.
LIFESTYLES
Sustainable
lifestyles
Unsustainable
lifestyles
Towards Sustainable Food Chain

Concept and Challenges
(Case study the dairy food chain in Poland)
Professor Micha Sznajder

Department of Agrifood Economics
Agricultural University of Pozna
Poland
Brussels 7.12.2006

Food Chain

Загружено:

Сведения о документе

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

Food Chain

Загружено:

Авторское право:

Доступные форматы

Towards Sustainable Food Chain

Concept and Challenges

Professor Micha Sznajder

Definition of the food chain

Definition of the food chain

Classical economy and sustainability

Classical, liberal economists toward sustainability

Classical economy and sustainability

Communists doctrine of harmonious development

Communists tried to practice a kind of sustainability, hidden behind

Strong backward and independent of human will processes always

The final result of centrally planed economy was disastrous.

We have to be aware that sustainability may trigger strong backward

Sustainable food chain

Sustainability may be linked to:

The following three elements play a key role here:

Goals of the sustainable food chain

Food chain directed toward sustainability or considered as sustainable

The goals of the sustainable food chain

air pollution control

The goals of the sustainable food chain

providing enough food for mankind

The goals of the sustainable food chain

achievement of equality point between supply and demand

The goals of the sustainable food chain

Macroeconomic approach to sustainable food chain

Global, regional or national food chains may be considered.

The macroeconomic approach leads to the aggregate matrix of ratios

Microeconomic approach to sustainable food chain

The food chain consists of several branch food chains. A particular

There exist dozens of individual food sub-chains; for example for

Econometric models for developing sustainability

Econometric model leading to sustainable dairy food chain

Source: The authors study

Food chain variables

Lifestyle as the keystone combining all available

preparing food from

Home food processing in Poland

Source: Sznajder M., Moskalik B. (2004): Food

Home food processing in Poland

bread, roll 4,8

Source: Sznajder M., Moskalik B. (2004): Food

Lifestyle as the keystone combining all available

New lifestyles impose on farmers and processors a new direction of

Lifestyles at the moment become the keystone combining all available

A big task is to promote new lifestyles promoting sustainable

The Polish national dairy food chain

The Polish national dairy food chain

Examples of the main economic developments

Moderate milk yield 4500-5000 kg

Maximization of very high milk

Maximum extension of grazing period on Maximization of the share of

Source: The authors study

Cattle density Up to 2 head per ha. Quality of

Over 2 heads per cow. Creates

Maximization of milk yield and

Elimination of competition between

Moderate milk yield 45005000 kg

Maximization of very high

Milk yield increase by bST

CATTLE DENSITY PER HA

Up to 2 head per ha. Quality

Over 2 heads per cow.

Maximization of milk yield