TRANSFOP

Transparency of Food Pricing

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 Obiettivo del progetto (Objective)

'The overall objective of this project is to address the key aspects of the food chain both that determine the transmission of price changes from farm to consumer levels, emphasising the role of competition in the intermediate and retail stages of the food chain and the broader regulatory environment in which firms in food supply chains across the EU compete. Given that the characteristics of the food sector vary considerably throughout the member states of the EU, and the observation that experience resulting from the recent commodity price spikes were significantly different across many countries, a key feature of the project will be to address how the variation in the structure of the food chain across different EU Member States contributes to food price adjustment in individual countries. Further, the project will address on-going developments in the food chain with regard to various aspects of vertical coordination in food supply chains, consolidation in the food sector, how the regulatory environment in which firms compete affects the overall functioning of food supply chains across the EU and the extent to which these issues also impact on SMEs. To this end, the project will address the issue of price adjustment in various dimensions across EU Member States, the selection of Member States reflecting differences in industry structure, the regulatory environment in which firms compete and the experiences they have recently faced with regard to commodity price shocks. In addressing these issues, a selection of different commodity chains (both ‘long’ and ‘short’) will form the basis of the analysis. The research project will be expected to result in significant new insights that address the functioning of food supply chains across the EU Member States that impact on food pricing transparency throughout the EU. To this end, the researchers will interact with stakeholder groups representing interests throughout the food chain in forming a potential Action Plan.'

Introduzione (Teaser)

The last decade has seen significant fluctuations in food prices, with knock-on effects for consumers and the European economy. A recent study has reviewed the transmission of food prices along the food production chain, all the way from farm to fork.

Descrizione progetto (Article)

During the surge in commodity prices between 2007 and 2012, food prices in some EU Member States increased by 5 to 6 times the EU average. A European Commission report in 2009 recommended an increase in transparency in the food chain to promote competition and resilience against further price fluctuations.

The EU-funded 'Transparency of food pricing' (http://www.transfop.eu (TRANSFOP)) project was then set up to investigate various aspects of price transmission in the European food sector. The initiative involved data collection and modelling. More than 20 research papers were published as part of the TRANSFOP project.

One finding was that consumer food prices are not directly related to changes in agricultural prices, but are rather affected by a number of other factors. In particular, researchers highlighted the interplay between food and energy prices, which may be due to increased biofuel production.

They also found that there are major differences between how food chains operate in different EU states. However, there were commonalities: farmers respond more quickly to major price fluctuations than retailers, and producer prices are, in general, more volatile than consumer prices.

Another finding was that networks of farmers or small producer companies seem to add value to the products of participating companies.

This is most likely through improved efficiency, organisation and management practices.

The overall outcome of the TRANSFOP project was a four-point action plan that identified priorities for improving price transparency in the EU. This document will inform policymakers and lead to more stable food chains.