The importance of processing and trade for sustainable food systems

The commitment to sustainable agriculture is enshrined in the Swiss Federal Constitution. At the same time, market pressures mean that farms are often recommended to increase their productivity and efficiency, specialize, and invest in capital-intensive technologies. This industrial logic can lead to agricultural land being decoupled from production – and to seasonal cycles being “switched off”.

Sweeping change needed throughout the food system

Overcoming the sometimes massive environmental and social problems that arise in this way requires a complete transformation of the entire food system towards sustainability. It is not enough to focus only on agricultural production, as production is also affected by what happens upstream and downstream. For example, consolidation processes among processors and retailers intensify the already growing pressure on prices from increasingly open global agricultural markets, often resulting in prices that are too low to cover farmer's production costs. But the type of production is also affected by factors such as the quantities required as well as delivery and purchase conditions.

While the negative impacts of industrialized agriculture and the international agribusiness are increasingly being studied, comparatively few studies are available on the interactions between agricultural production and downstream sectors. Also lacking are comprehensive studies on the role of independent small and medium-sized food enterprises – which are increasingly under pressure – in achieving sustainable agricultural production.

Project objectives and scope

This project – “The importance of processing and trade for the development of a sustainable food system” – contributes to a better understanding of these interdependencies. It identifies measures and solutions on how to change current conditions in downstream sectors, so that agricultural production can become more sustainable and diversified than it is today.

The project focuses on the value chains of milk and meat, involving producers, the processing artisanal and industrial trades – dairies, cheese dairies, slaughterhouses and butcher shops – as well as the retailers and discounters in Switzerland.

Research approach

The project is transdisciplinary and involves processing industries with large and small market shares as well as local SMEs, farmers, and associations of processors and producers. It uses a mixed-method approach to investigate the following research questions:

• What are the main market structures and forms of organization in the downstream sector?
• What repercussions do these have on agricultural production methods?
• What changes are needed in structure, supply and purchase conditions, processing, and trade, to enable promotion of diversified, organic agriculture?
• Which legal frameworks hinder sustainable development in the food sector, and which favour structural change and processes of business consolidation?
• What adjustments to the framework conditions are necessary to support more diverse processing and marketing structures in favour of organic farming?
• How can already existing beneficial structures and modes of operation in the downstream sector be maintained and promoted?