Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Examination of Witness (Questions 177 - 179)




  177. We are having an inquiry basically into what agriculture would be like, as it were, in a world with either different subsidies or no subsidies. We are anxious to sketch the architecture of the world in which agriculture would have to live and thrive. One of the important things is what is happening out there in terms of consumers, what the trends are, what consumers want. We thought you were quite a good chap to tell us about that. I wondered if you would give us an initial, one-minute burst on what you think of it. If we got nothing else from this, if there is one essential factor we have to remember about what is happening in the marketplace, remembering all that Curry said about disconnection of funds, what would be that one thing we must not let go of?

  (Professor Hughes) This is the easy step first. What would I say? I guess that, if we achieve sustained income growth, the relative importance of price in food as an attribute declines, notwithstanding that, if you listen to the marketplace, it seems to be all about price. Clearly, in developed countries where for many households the expenditure on food is not the biggest constraint, then we are looking for a lot more out of our food than low prices. The sort of attributes would include esoteric quality ones, which could be better taste, provenance and you could perhaps bolt on some environmental or animal welfare type aspects. Price is important but there are many other things associated with food products that are as increasingly important.

  178. Is that true of all classes and groups?
  (Professor Hughes) Clearly not. What would we get? There are 60 million of us and about 23 million households. Probably 70 per cent of households are not income-constrained when it comes to their food budget and they can make choices; 30 per cent are clearly constrained. That is reflected in the sort of products you see in the store. If you look around the supermarket, there are products for the haves and there are products for the have nots.

  179. Is the market becoming more or less differentiated?
  (Professor Hughes) It is becoming more differentiated.

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