Two more years of food price misery

GLOBAL food prices will continue to soar for the next two years, producers and analysts warned yesterday, as the Scottish Government launched an inquiry into improving affordability.

The nation's farmers and manufacturers, in Edinburgh for the Royal Highland Show, told The Scotsman they could see no chance of "agflation" easing in the near future.

They spoke as Richard Lochhead, the environment secretary, unveiled plans for a major investigation into affordable access to food in response to world price increases.

Although the move was welcomed by industry bodies and related agencies, there were warnings the government could not, and should not, interfere with the markets.

"To be quite frank, the government can do nothing and should keep out of it," Bryan Johnston, director of the analyst Bell Lawrie, said. "This is not the role of government. Its role is to legislate, unless there is clear abuse of the market. And there's no evidence of that.

"The last thing the industry needs is another tier of bureaucratic form-filling to do something that will benefit no-one."

He said there were "great difficulties ahead" which would have to be ridden through until the market righted itself.

Liz Cameron, of the Scottish Chambers of Commerce, said any government intervention would have to be with "a light touch", but that it could be very valuable if it encouraged consumers to eat locally. This would build up a domestic market that could drive down prices and prevent producers relying on turbulent foreign trading.

The Scotsman has learned that the government is to work with discount food retailers to help achieve access to affordable food for all.

The identity of the person who will chair the affordability inquiry will be announced soon, and he or she will report to a Scottish Food and Drink Leadership Forum, chaired by Mr Lochhead. It will also include a champion for access and affordability – Dave Simmers, the strategic co-ordinator of Community Food Initiative North East.

The move is part of Scotland's first national food policy, aimed at improving the food and drink economy as well as the nation's health.

Mr Lochhead said: "I know that government alone cannot bring about a change in attitude towards food and drink – winning over the hearts and minds of the people of Scotland will be key to continuing this revolution."

There have been efforts to tackle increasing food costs, including an emergency United Nations summit last month. Representatives from 183 countries travelled to Rome for the three-day summit to look at how to combat growing hunger and civil unrest triggered by the rocketing food and fuel prices.

Figures from the Office of National Statistics show food prices have risen 8.7 per cent in the past year, mainly due to spiralling meat costs. The cost of bread and eggs have also risen sharply.

Prices are being driven up by a global food shortage, which is powered by four key trends: population growth, the increasing use of crops for fuel rather than food, the "westernisation" of diets in the Far East, and a diminishing bank of farming land due to urbanisation and climate change. Market speculation is also a potential factor.

Many exhibitors at the Highland Show said they were feeling the strain of the increased cost of raw products, as well as of fuel and power. However, they also said they were sceptical about how much the government could do to ease their woes.

Frank Yorke, a Dundee butcher, said his main concern had been the cost of beef going up about 40 per cent in the past year. "I can only see that continuing for the next two years," he said. "The costs of barley and wheat have also been rising around the world, and I can't see that changing at all.

"One of the big issues has been that food has been undervalued for far too long and price rises have come too quickly for the food industry in Scotland.

"The Scottish Government really needs to do more to help Scottish farmers, as a lot of them are fair scunnered at the moment. They basically need to do more to promote farming as an industry, help farms address new technology and make the best use of their land, and show how they can get involved in things like supplying wheat to breweries."

Humphrey Errington, whose Lanarkshire company makes the famous Lanark Blue cheese, said: "We are expecting further increases in the cost of milk over the next year or two, and although we don't want to do it, we are probably looking at having to put up our prices by something like 10 per cent, although most cheese producers have already had to increase prices."

Chris Young, of the Handmade Oatcake Company in Crieff, Perthshire, did not see what difference a Scottish Government inquiry could make "as most of the factors affecting food prices are outwith its control". He said ministers would be better putting money into supporting the food industry.

Ken Stahly, whose Glenrothes company specialises in haggis products, said: "I am not sure what this inquiry will do for a company like ours, as these issues are outwith the control of the Scottish Government, and problems over fuel prices have been affecting countries all over Europe."

Opposition politicians said the SNP's proposals were not ambitious enough and had taken too long to come about.

Jim Hume, the Liberal Democrats' environment spokesman, said it was encouraging the government would have a new catering contract featuring local food but added: "This is not ambitious enough and it has taken far too long."

Home produce to be promoted in industry overhaul

Lindsay McIntosh

FOOD produced in Scotland will be labelled with information on its nutritional content and place of origin under ambitious government plans to overhaul the industry and attitudes towards eating.

Ministers are also launching a campaign to promote domestic produce and boosting food education with a "Cooking Bus" which will tour schools and community groups.

The plans form part of the National Food Policy, unveiled yesterday by Richard Lochhead, the environment secretary, at the Royal Highland Show in Edinburgh. However, he admitted that implementing a labelling regime would be potentially illegal under EU law, and he planned to lobby Westminster for support, as well as consider a voluntary scheme.

The policy – the first of its kind – is the result of months of government consultation with the public and the food and drink industry. A central plank is encouraging Scots to eat locally and it has the backing of celebrity chefs Nick Nairn and Martin Wishart.

The scheme also includes backing the creation of a world-class health and nutrition centre through the merger of Aberdeen University and the city's Rowett Research Institute. And ministers say they will lead the move towards more positive eating by securing a new Scottish Government catering contract with greater emphasis on healthier menus and the procurement of fresh and seasonal produce.

NFU Scotland said the policy had to address sustainable farmgate prices, immediate action on fuel costs, a reduction in red tape and clear and consistent labelling of Scottish products. President Jim McLaren said farmers were willing to play their part in the "exciting and ambitious" proposals but this was "tempered by the current agricultural climate".

Also at the show, Alex Salmond, the First Minister, announced plans to stage a summit with supermarket bosses. He said they would discuss how to work together to secure a future for primary food producers.

'Scotland doesn't need GM'

FEARS over spiralling global food prices yesterday reignited the debate over GM foods, with Scottish and English ministers polarised on the issue.

Richard Lochhead, secretary for the environment at Holyrood, insisted genetically modified food had no part to play in the nation's diet – just after his Westminster counterpart had said it needed to be looked at again.

After launching the national food policy, Mr Lochhead said: "One of the reasons why Scotland has such a fantastic international reputation for food and drink is because we have a fantastic, clean, green image of lochs and land. That would be distorted, I believe, by going down the GM route.

"I believe it's in the interests of Scottish food and drink to be GM-free."

However, UK environment minister Phil Woolas said there was "a growing question of whether GM crops can help the developing world out of the current food-price crisis".

Mr Woolas reportedly held talks this week with the Agricultural Biotechnology Council, an umbrella group formed in 2000 to promote the role of biotechnology in agriculture.

His position angered green groups, who claimed the government was "seriously misled" if it thought GM crops were going to stop the food crisis.

Greenpeace accused the biotech industry of "abusing the misery of millions of hungry people" by trying to promote its products as a solution to rising food prices.

FROM MAY 2007 TO MAY 2008

Thick-sliced white loaf, 800g

WAS 54p
NOW 65p

Semi-skimmed milk, six pints

WAS £1.68
NOW £1.96

Maris Piper potatoes, 2.5kg

WAS £1.58
NOW £1.78

Teabags (premium), 80

WAS 82p
NOW £1.37

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