Memorandum submitted by Tesco (SFS 75)
NOTE OF EXPLANATION
may be helpful to explain the limitations of this paper.
is not and cannot be responsible for food security and indeed agricultural
policy in the short, medium or long term; that is a matter for Government.
is a retailer and contributes to the economy via innovation and product
improvements like many other large firms.
It deals largely with food products and has considerable expertise in
some technical areas including food safety and quality and the supply
chain. None of this makes us experts in
long term food security.
recent years we have also sought to develop in expertise in how food retailing
can contribute to Government objectives on climate change.
said, we are informed observers of the current state of affairs and would offer
the following comments on the issues which interest the Committee to supplement
the evidence given by Tesco at the Hearing on 25 February 2009.
recognise the widely-held view that global food production will need to
increase by 50% by 2030 and by 100% by 2050 to meet the needs of a growing
share the view that some of the key constraints on growing production to these
on the amount of agricultural land, particularly as many parts of the world
become more developed and more urban.
challenge of climate change: the need to lower greenhouse gas emissions while
increasing agricultural production; and the likelihood that increasing global
temperatures will make some areas which currently produce food unable to do so
in the future.
sustainability challenges, including the challenge of water depletion in many
parts of the world.
do not believe that - particularly set against these constraints - the right
route to secure the increases in production required lies in an outdated
protectionist approach to food production.
Such an approach helped to secure large increases in global production
in some countries - including Europe and the US - after the Second World
War. However this was at the cost of
huge economic inefficiencies, financial burdens on consumers and taxpayers in
many countries and severe damage to the agricultural economies of many
believe that the right approach to the modern challenge of food security lies
in competitive markets which enable comparative advantages to flourish, and
which encourage the innovation and productivity increases that will be needed
to feed a growing world population.
an international business operating in 14 countries in Europe, Asia and the US,
our sourcing policy in the face of these challenges can be summarised as:
2.5.1. A commitment to international sourcing, so that consumers around the world benefit from the widest range of quality products at the best prices.
2.5.2. A commitment at the same time to source locally wherever possible. Consumers often express a preference for locally-produced products, and there can be significant advantages in terms of responsiveness to consumer demand, freshness and lower distribution costs and emissions. In the UK, approximately 90% of our fresh chicken, 95% of our fresh beef, 80% of our fresh pork and 80% of our fresh lamb is British, as are 100% of our fresh eggs and milk. We have also in recent years significantly increased our commitment to local sourcing, opening a network of regional offices across the UK with dedicated buying, marketing and technical teams. We currently stock 3000 local lines which we promote through events, point of sale and marketing.
determination to ensure that agricultural production for Tesco meets strong
environmental standards. This is
achieved through our "Nurture" scheme, an independently accredited global
quality standard for fruit and vegetables which covers 15,000 growers in 70
countries. Alongside ensuring full
traceability for our fruit and vegetables, Nurture requires adherence to high
standards of wildlife protection and landscape conservation, sustainable
farming practices, including the use of energy and natural resources, and the
rational use of artificial pesticides, fertilisers and manures. Each grower is audited on an annual basis.
agree with the recent Chatham House report that some factors - in particular
water scarcity, climate change, land availability and the rising costs of
agricultural inputs - require special attention and we address these below.
3.2. Water Scarcity
3.2.1. Water scarcity is a significant and growing global
issue. 70% of water used worldwide goes
towards agriculture and food production.
As the climate changes, some parts of the world will face fresh water
shortages and by 2025, two-thirds of the world's population may be impacted by
3.2.2. We have
begun to respond to this challenge by implementing water-saving initiatives in
our businesses across the world. Our
Chinese business uses rainwater harvesting and grey water for car washing and
toilets; there are closed circulation car washes in our Polish distribution
centres; and in the Czech Republic we have installed specially designed water
efficiency fixtures and fittings. In
the UK, our newly developed environmental blueprint for stores incorporates
rainwater harvesting techniques which reduce potable water used by the store by
50%. We also use other water saving
technologies such as taps with automatic shut offs or electronic sensors and
low dual flush toilets. We have run
consumer information campaigns, for example in schools in Turkey.
3.2.3. We recognise that more needs to be done in
understanding and reducing the water footprint of the whole food supply
chain. We are therefore working with
the Sustainable Consumption Institute, established by Tesco at the University
of Manchester, to understand better the issue of water scarcity, how it will
impact on the supply chain in the future and the role we can play in mitigating
it. The results will be shared freely
so that the whole food industry can benefit.
Areas for consideration include:
126.96.36.199. The cause and nature of the problem of water scarcity.
188.8.131.52. The possible solutions at a global level, including the role of technology and of water efficient production methods.
184.108.40.206. The scale of this issue for our business.
220.127.116.11. The role that we can play, by tackling the
issue in our own business, working
with our supply chain, and helping customers play their part.
3.3. Climate change
sustainability and growth around the world depends crucially on an effective
response to the global challenge of climate change. A failure to act effectively could mean we are threatened with
significant and increasing economic and social disruption on the scale of the
great wars and economic depression of the last century. Indeed there was a very interesting recent article
in Science (November 2008) which suggests the fall of the Chinese Dynasties was
linked to weakening monsoon power which reduced rainfall and hit harvests. There was also a dry period during the
decline of the Mayans in Central America.
is committed to playing a leadership role in tackling climate change, in
particular by innovating and investing in sustainable technologies and
buildings, and using our relationship with customers to empower them to take
part in a revolution in green consumption.
As part of our climate change strategy, we are making significant
investments in developing low-carbon stores and distribution centres. These investments will help us meet our long
term targets set in 2007:
18.104.22.168. To reduce the CO2
emissions from our existing stores and distribution centres by at least 50% by
2020, against a baseline of 2006. By the end of 2008, our UK energy use per square foot
was half what it was in 2000.
22.214.171.124. To reduce by 50% the amount of CO2e
used in our distribution network to deliver a case of goods by 2012, against a
baseline of 2006. Last year in the UK we
achieved a saving of over 10%.
126.96.36.199. To reduce CO2e emissions from new stores by
50% on average by 2020, from a baseline of 2006, developing environmental
formats. Our recently opened Cheetham
Hill store near Manchester has a
carbon footprint 70% less
than an equivalent store built in 2006 and will be a model for future stores.
account directly and indirectly for 60% of carbon emissions. We believe that engaging and empowering them
is therefore a crucial aspect of tackling climate change. As an example, we are - alongside DEFRA, the
Carbon Trust and the British Standards Institute - developing an accepted and
commonly understood measure of the carbon footprint of every product we sell to
enable customers to easily compare products, in the same way that they can
compare products' nutritional content.
So far we have labelled 100 products with their carbon footprint and we
are working to footprint further products.
We are also making it cheaper and easier for our customers to make green
choices, through for example halving the price of energy efficient light bulbs
and our Greener Living range.
2007 we began a five-year, £25 million funding programme for a new Sustainable
Consumption Institute (SCI) at the University of Manchester. The SCI has been established as a leading
centre for sustainable consumption research to develop research to define and
accelerate the steps required to make a successful transition to a low-carbon
economy and society; research that will be published and freely available. We are also working with suppliers to
develop low carbon supply chains, products and services. This is particularly important in the food supply
chain given what we know about the environmental impacts of agriculture. Through our Sustainable Beef and Dairy
Projects, and the Dairy Centre of Excellence, we are working with suppliers to
understand how the environmental impacts of production can be reduced.
3.4. Land Availability
3.4.1. There are many competing demands on land, including for food, feed, timber, paper, fuel and development. This is on top of the impact of soil loss through erosion and desertification. It is therefore important that the right balance is struck in terms of land allocation and management.
techniques have a particularly important role to play, with unsustainable
methods leading to the deterioration of existing land
stock and a lowering of yields. We are
therefore committed to high standards of land stewardship, environmental protection and sustainable
production within our supply chain.