Global Forum on Food Security and Nutrition (FSN Forum)

Dear SOFA team,

Please find attached our proposed contribution for the SOFA 2024 report: "A framework for fair prices and governance mechanisms to support sustainable farming and innovative value chains".

Kind regards,

Anton Riera

Nationwide TCA Experiment - Findings and Learnings of a German True Cost Campaign

We have lead the campaign of implementing true costs for several food products within the German discounter PENNY in August 2023. 

Here, we describe our main results and findings of this campaign.

Please find our submission attached, with more supplementary material. 

Best, 

Dr. Amelie Michalke

See attached. 

SOFA Box Proposal: estimating the hidden health, environmental and social costs of not breastfeeding children as the first-food system: Case studies using four nutrition tools

Julie P Smith, ANU; Tuan Nguyen, Alive & Thrive; Patrizia Fracassi, FAO;, Phil Baker, Deakin University; Roger Mathisen, Alive & Thrive

I am writing to express my interest in participating in the upcoming forum as the Deputy Chairperson responsible for coordinating international cooperation and implementing state programs at the State Agro Credit and Development Agency under the Ministry of Agriculture of the Republic of Azerbaijan, I am keenly aware of the critical challenges and opportunities that lie within our agrifood systems. In my current role, I have the privilege of overseeing projects and initiatives that directly impact the agrifood sector. My responsibilities involve not only ensuring the effective implementation of state programs but also fostering international partnerships to promote sustainable agricultural practices and economic development. This position has provided me with a unique perspective on the multifaceted nature of agrifood systems and the necessity of integrating diverse viewpoints and data into our decision-making processes. The theme of the forum resonates deeply with the work we are doing in Azerbaijan. We are actively seeking to uncover and address the hidden costs associated with agrifood systems, such as environmental impacts, social inequality, and economic disparities. Simultaneously, we are identifying and leveraging the often-overlooked benefits these systems can offer, particularly in terms of community development, cultural preservation, and innovation. By participating in this forum, I hope to bring insights from Azerbaijan's experience, learn from international best practices, and engage in meaningful dialogue with global experts. The knowledge and networks I aim to gain from this forum will be invaluable in enhancing our strategies and policies back home. Moreover, it presents an opportunity to contribute to the global conversation on transforming agrifood systems in a way that is equitable, sustainable, and forward-thinking. I look forward to the possibility of contributing to and learning from this important discussion. 

The Iranian legislative bodies are about to enact a national document on knowledge-based food security which outlines an action plan for future measurements. This document is expected to provide useful information for SOFA 2024.  the attached document, the answer to the template's question has been provided based on this document.

Effectively incorporating hidden costs and benefits of agrifood systems into decision-making for transformation involves thorough analysis and holistic consideration. Utilizing life cycle assessments, stakeholder engagement, and robust economic models can help uncover hidden factors. Additionally, promoting sustainability metrics, such as environmental and social impact assessments, can aid in making informed decisions that balance economic, environmental, and social aspects of agrifood systems.

Kivumbi Earnest Benjamin & President Heal The Planet Global Organisation- HTP

The negative externalities of poor welfare for farm animals

The 2023 SOFA report is welcome but barely mentions the welfare of farm animals. However, consumers increasingly are concerned about poor animal welfare. Accordingly, I believe that the 2024 SOFA report on the true cost of food should include a section on the need to include the negative externalities of poor animal welfare within true cost accounting.

A key challenge to date has been the limited number of papers that attempt to put an economic cost on poor welfare. Earlier studies looked at consumers’ willingness-to-pay for specific animal welfare improvements. For example, Bennett and Blaney (2003) produced a paper entitled Estimating the benefits of farm animal welfare legislation using the contingent valuation method. This paper aimed to elicit UK citizens’ willingness-to-pay to support EU legislation to ban the keeping of egg laying hens in battery cages.[1]

More recently an improved approach has been set out by researchers from Wageningen Economic Research in a paper entitled A method for calculating the external costs of farm animal welfare based on the Welfare Quality® Protocol.[2] The paper aims to provide a method that can be used to estimate the external costs of inadequate farm animal welfare.

This paper points out that “When the level of AW [animal welfare] drops below a certain standard, the keeping of animals for food production creates a negative externality: animal suffering (Lusk and Norwood, 2011).”

In the paper’s method to calculate the external costs of AW at farm or production system level, two datasets are needed: 1) AW score, and 2) costs of AW measures. The first dataset contains data about the level of AW score of farms with different levels of AW and is based on the welfare scores of the Welfare Quality® Protocol as a measuring standard. The Welfare Quality scores are based on four welfare principles, namely good feeding, good housing, good health and appropriate behaviour.

The second dataset contains data regarding abatement costs i.e. the costs of the measures needed to prevent the re-occurrence of AW problems by improving farm management or the environment of the animals to a level where AW issues are minimised. The abatement costs  are the costs associated with a set of measures required to achieve an acceptable level of AW. The paper notes that a higher level of AW might also result in benefits through reduced costs due to improved productivity and animal health.

The paper’s method can be integrated in true cost accounting methods to calculate the external/hidden costs of poor animal welfare.

I also suggest reading a blog on this subject by Berk Özler, Lead Economist, Development Research Group, World Bank.   https://blogs.worldbank.org/impactevaluations/it-time-development-econo…

Please see a proposed contribution on "Estimating the Hidden Costs of Unhealthy Diets: A Country Case Study." 

SOFA Box Proposal: Estimating the Hidden Costs of Unhealthy Diets: A Country Case Study.

Felipe Dizon (World Bank), Patrizia Fracassi (FAO), Giles Hanley-Cook (Consultant, FAO), Susan Horton (Consultant, FAO), Kyoko Shibata Okamura (World Bank)

Current efforts to quantify the hidden economic costs of unhealthy diets (FOLU, 2019a; FAO, 2023) are galvanizing policy makers to act, in view of the global scale of the problem. FOLU (2019a) estimated the hidden costs of undernutrition as $1.8 trillion in 2018 (1.4% of global GDP, calculations using international dollars), and of obesity as $2.7 trillion (2.0% of global GDP). FAO (2023) used a similar methodology to derive national estimates for 154 countries. These large and shocking numbers have helped turn attention towards the potential role of agrifood systems policies, as a complement to contemporary public health policies.

Recognizing the complexity of covering all dimensions of hidden economic costs, our contribution proposes a country-level methodology to estimate the attributable risk of unhealthy diets for suboptimal nutritional status (e.g., overweight and obesity) and health outcomes (e.g., type II diabetes).

Our methodology addresses some of the recognized limitations and simplifying assumptions of FOLU (2019a) and FAO (2023). FOLU (2019b) note that “This analysis does not adopt a strict economic definition of externalities, but instead includes more broadly the top sources of lost value or of human and social costs related to global food and land use systems … As a result, this exercise provides a reasonably reliable indicative measure of the order of magnitude of hidden costs, but not in any way a conclusive answer. A key aim is to inform debate on this subject and inspire future research” (p14). Both FOLU (2019a) and FAO (2023) rely heavily on the IHME’s estimates of health impacts. Questions have been raised about the robustness of the IHME estimates at country level in view of significant changes between analyses using 2017 and 2019 data (Stanton et al, 2022), about the reliability of the country-level dietary data given the substantial data gaps requiring somewhat opaque interpolation (Beal et al (2021), about the unknown amount of double-counting when aggregating across multiple dietary risks, and about whether the estimates control appropriately for obesity separately from individual diet components (Horton et al, 2024).

Ongoing joint work between the World Bank and FAO aims to provide a more robust methodology which can be used at country level (Horton et al, 2024), building on the policy momentum generated by the global estimates, and taking up FOLU’s (2019b) exhortation for debate and further research. The work starts from the premise that one should not conflate malnutrition (in all its forms) with unhealthy diets. Although inadequate nutrient intakes is a key driver of undernutrition (here meaning child stunting and child wasting), one cannot forget the important role of infections and diseases. Hence improving water and sanitation (for example) must be considered along with diet in policies to reduce stunting (Mbuya et al). Similarly, one cannot assume that all individuals with a healthy weight have healthy diets: they may consume inadequate amounts of micronutrients and excessive amounts of salt and other dietary factors associated with higher risk of non-communicable diseases (NCDs). Finally, dietary intervention alone may not suffice to move overweight and obese individuals into the healthy weight category, especially in the absence of important confounding factors like healthy lifestyle behaviours.

This new project proposes to build on recently-developed, holistic, healthy diets metrics which aim to assess NCD risk at-scale. In particular we plan to use the two sub-metrics of the Global Diet Quality Score (GDQS) (Bromage et al, 2021). The GDQS is based on semi-quantitative diet recall data. The overall score is based on 25 food groups, 16 of which are considered to promote health, 7 of which are associated with increased NCD risk, and 2 of which when consumed in excess are associated with increased NCD risk.

We plan to use the new generation of combined nutrition and health surveys being collected in low- and middle-income countries, similar to surveys initiated in the high-income countries as obesity rates started to climb. These surveys contain (quantitative) dietary intake data, anthropometric data and selected NCD risk data (such as hypertension and fasting blood glucose). We expect this will allow us to estimate the health risks and economic costs associated with those individuals with healthy weights but unhealthy diets, and similarly to differentiate the health risks among overweight and obese individuals according to how healthy or unhealthy their diets are. This is an improvement over conflating weight status with healthy diets and allows policy to be better targeted through an increased understanding of risks associated with context-specific dietary patterns.

We are aiming to start work in the Philippines, a country where the “double burden” of malnutrition features prominently. A summary article using the 2013 National Nutrition Survey noted that one in ten adults has chronic energy insufficiency while three in ten are overweight or obese, and 70-80% of the population do not meet their needs for key micronutrients (Angeles-Agdeppa et al, 2019).

Estimates of the associated economic costs of malnutrition in all its forms vary considerably. FAO (2023) estimates the cost of the burden of disease (undernourishment) as 0.02% of GDP in 2020 but this excludes future productivity losses associated with losses in educational attainment and premature mortality. Mbuya et al (2021) include these additional losses, and their estimate is a loss of 1.5% of GDP in 2015. FAO (2023) estimates the cost of the burden of disease from dietary patterns (obesity and NCDs) as 6.8% of GDP in 2020, reflecting the use of IHME’s estimates of health impacts.

We anticipate that applying the proposed new methodology to nationally-representative data from the Philippines will provide useful estimates of the effect of diet quality on cost. The aim is that this analysis can inform national agrifood systems discussions. One concrete objective is to analyze whether existing public agricultural funding can be reoriented so as to support policy coherence in the agrifood and health sectors.

References:

Angeles-Agdeppa I, Sun Y, Denney L, Tanda KV, Octavio RAD, Carriquiry A, Capanzana MV. Food sources, energy and nutrient intakes of adults: 2013 Philippines National Nutrition Survey. (2019) 18:59 https://doi.org/10.1186/s12937-019-0481-z

Beal T, Herforth A, Sundberg S, Hess SY, Neufeld LM, 2021. Differences in modelled estimates of global dietary intake. Lancet 397 (10286): 1708-9. https://doi.org/10.1016/S0140-6736(21)00714-5

Bromage S, Batis C, Bhupathiraju SN, Fawzi WW, Fung TT, Li Y, Deitchler M, et al. Development and Validation of a Novel Food-Based Global Diet Quality Score (GDQS). J Nutr. 2021 Oct 23;151(12 Suppl 2):75S-92S. https://doi: 10.1093/jn/nxab244

FAO. 2023. The State of Food and Agriculture 2023 – Revealing the true cost of food to transform agrifood systems. Rome. https://doi.org/10.4060/cc7724en

Food and Land Use Coalition (FOLU), The. Growing Better. 2019a. https://www.foodandlandusecoalition.org/global-report/

---------. 2019b. Growing Better: Technical Annex. https://www.foodandlandusecoalition.org/wp-content/uploads/2019/09/FOLU-GrowingBetter-TechnicalAnnex.pdf

Horton S, Fracassi P, Siekmans K, Kato T, Hanley-Cook G. Estimating economic costs of unhealthy diets: a proposed methodology. World Bank Policy Research Working Paper 10671, January 2024. https://documents.worldbank.org/en/publication/documents-reports/documentdetail/099839401162431298/idu152ca6b541085314ca41a22a1bf67750bec89

Mbuya NVN, Demombynes G, Piza SFA, Adona, AJV. 2021. Undernutrition in the Philippines: Scale, Scope, and Opportunities for Nutrition Policy and Programming. International Development in Focus. Washington, DC: World Bank. http://hdl.handle.net/10986/35530

Skoufias E, Vinha K, Sato R. 2019. All Hands on Deck: Reducing Stunting through Multisectoral Efforts in Sub-Saharan Africa. Africa Development Forum series. Washington, DC: World Bank. doi:10.1596/978-1-4648-1396-2

Stanton AV, Leroy F, Elliott C, Mann N, Wall P, De Smet S. 2022. 36-Fold higher estimate of deaths attributable to red meat intake in GBD 2019: Is this reliable? Lancet 399 (10332): e23–26. https://doi.org/10.1016/S0140-6736(22)00311-7.

Mr Raghav Puri has participated in the SOFA call via the AI-based application. He is kindly sharing his submission with other participants.

"question": "Have you had the chance to review any materials related to SOFA 2023? Considering that SOFA 2024 aims to delve into the application of true cost accounting (TCA) through case studies, with the aim of advancing agrifood systems toward sustainability, do you have any recommendations to enrich the upcoming report?",

        "answer": "At the Tata-Cornell Institute (TCI) at Cornell University, we are undertaking a TCA study of India's Public Distribution System (PDS), a food-based safety net providing highly subsidized food grain to over 800 million individuals, to identify ways to reduce the true cost of the PDS"

"question": "For the purpose of contributing to the content of SOFA 2024, are you aware of any relevant studies assessing hidden costs or benefits within agrifood systems? If so, could you please provide the title of the study, the author(s) and hyperlink(s) to any relevant documentation. ",

        "answer": "We have released our preliminary findings on promoting millets in the PDS. In this policy brief, we use TCA to estimate the true cost of providing rice, wheat, and millets through the PDS. Currently, the PDS provides most beneficiaries with 5 kilograms of food grain (a combination of rice and wheat). We use TCA to estimate the savings (in true and financial cost terms) from replacing one kilogram of rice with one kilogram of millets for one-fourth of PDS beneficiaries (~200 million individuals)."

"question": "Can you provide a brief overview of the study, including a description of the agrifood system(s) or component(s) that were the focus of the assessment?",

        "answer": "https://tci.cornell.edu/wp-content/uploads/2023/12/TCI-Policy-Brief_Pro…"

"question": "Could you describe the specific hidden costs and benefits associated with the agrifood system(s) or component(s) assessed? ",

        "answer": "Greenhouse gas emissions and unsustainable (blue) water use."

"question": "Why was the assessment necessary to uncover and address these hidden costs?",

        "answer": "The Indian government procures approximately 44 percent of rice and 41 percent of wheat produced in India. This food grain is distributed through India's food-based safety net programs (primarily the PDS) to low-income households. A large share of the rice and wheat procured come from a handful of states in India - where intensive rice and wheat cultivation results in negative environmental impacts (such as declining groundwater levels, air pollution from the burning of crop residue, and overuse of fertilizers and pesticides.\n\nThis study aims to provide alternatives to reduce the true cost of the PDS by assessing the true cost of replacing one kilogram of rice (from the current PDS allocation) with one kilogram of millets. Millets require significantly less water and are more nutritious than rice."

"question": "What were the specific hidden costs that the assessment aimed to uncover and address?",

        "answer": "Quantitatively, greenhouse gas emissions and unstainable (blue) water use. Qualitatively, nutritional benefits and livelihood impacts (for millet farmers in states that do not benefit from PDS procurement)."

"Could you please tell us when the assessment took place and which years were considered in the analysis? ",

        "answer": "The policy brief was released in early November 2023. The analysis takes into account production and procurement for the PDS in 2021-22."

"question": "Can you provide a concise description of the methodology employed to uncover hidden costs and benefits?",

        "answer": "Existing studies were used to estimate GHG emissions and unsustainable (blue) water use for rice, wheat, and millets (Finger Millet, Pearl Millet, and Sorghum). These estimates, along with monetization factors from the Impact Institute (Netherlands) and administrative data from the government of India, were used to calculate state-wise true costs of providing rice, wheat, and millets, through the PDS."

"question": "Was the assessment complemented by additional methodologies, such as quantitative or qualitative policy or scenario analysis? Did these supplementary methods deliver interesting results? ",

        "answer": "A scenario analysis was conducted to estimate the savings from replacing one kilogram of rice with one kilogram of millets for one-fourth of PDS beneficiaries (~200 million). Doing so, reduces the true cost of the PDS by $770 million (and financial cost by $110 million) - which is approximately 2.2 percent of the true cost of the PDS. The decline in true cost is primarily due to less use of blue water."

"question": "Please describe the data used in the assessment, including their source and nature. Additionally, if there were challenges related to the data availability, kindly elaborate on those challenges.",

        "answer": "Data for crop-wise GHG emissions was obtained from Nayak et al. (2023) in Pedosphere, and data for unsustainable water use was obtained from Kayatz et al. (2019) in Science of the Total Environment.\n\nThe major challenges related to data included finding crop-wise and state-wise estimates for soil erosion, crop residue burning, and input use from existing studies."

"question": "Could you please highlight the key findings of this assessment? Were there any effective practices or methods that you found particularly valuable?",

        "answer": "The key finding from this assessment is that the per kilogram financial cost of providing rice, wheat, and millets through the PDS (i.e. the costs associated with acquiring and distributing food grain through the PDS) are 36.7, 25.9, and 32.9, respectively. However, when costs associated with GHG emissions and unsustainable water use are accounted for in the cost of these food grains, the 'true cost' of these food grains is 68.5, 54.3, and 42.9, respectively. \n\nWhile millets are more expensive than wheat in financial cost terms, they are significantly less expensive than rice and wheat when true costs are taken into consideration.\n"

"question": "What were the effective practices or methods that you found particularly valuable during the assessment?",

        "answer": "We used the Rockefeller Framework to guide our analysis - it was very helpful as we were able to use their technical appendix and publicly available excel model to guide our study."

"question": "What were the true costs of providing rice, wheat, and millets through the PDS when accounting for GHG emissions and unsustainable water use?",

        "answer": "68.5, 54.3, and 42.9, respectively"

        "question": "Did the assessment provide information relevant to policymakers or other stakeholders? For example, did it identify possible policy entry points to transform agrifood systems? If not, why?",

        "answer": "Yes, the policy brief did provide information relevant to policymakers by identifying areas where millets are produced and highlighting the opportunities for millets farmers to benefit from PDS procurement in these areas.\n\nThe scenario analysis took into account the current production and procurement of millets (as well as beneficiaries' taste preferences) and limited the analysis to one-fourth of beneficiaries. "

"question": "Drawing upon your experience, can you identify key factors that can facilitate or hinder the success of future similar assessments for transforming agrifood systems across different contexts?",

        "answer": "As we were using the Rockefeller Foundation's report on the true cost of food in the US, it was clear that many of the metrics used in the US report were not available for India. Data availability will play a key role in facilitating the application of TCA in developing country contexts.\n\nWe were lucky to receive monetization factors from the Impact Institute. If these monetization factors are made available publicly, it will definitely lead to more useful applications of TCA.\n\nFinally, TCAs focussing on national food systems are able to use national-level data or estimates. For countries like India, where subnational food systems play an important role, TCA applications will require state-level data and estimates for quantifying and monetizing costs associated with food systems."

"question": "Were there any significant challenges encountered during the assessment process? Can you identify strategies or approaches to overcome these challenges?",

        "answer": "One of the major challenges was the limited availability of studies that quantify and monetize food-related impacts. However, conducting a TCA allows researchers to identify areas for future research as it highlights gaps in existing research."

"question": "Do you have any other information or comments on the use of true cost accounting assessments to uncover the hidden costs and benefits of agrifood systems that haven't been covered during this interview?",

        "answer": "No"

        "question": "How would you rate your overall experience with the interview conducted by the AI chatbot?",

        "answer": "Very positive"

        "question": "How natural did the conversation with the AI chatbot feel?",

        "answer": "Somewhat natural"

        "question": "If you were to participate in a future study involving a qualitative interview conducted through a AI Chatbot, would you prefer texting with the same AI Chatbot or an actual human interviewer?",

        "answer": "Slightly prefer AI chatbot"

Dear all,

Annexed:

- Our general contribution for SOFA 2024

- Attachment with 5 studies on hidden costs in the Netherlands

Kind regards,

Joost de Jong, Jan Paul van Soest, Dutch Food Transition Coalition (TCV)

Jeroom Remmers, TAPP Coalition

Getting the prices right in food and agriculture

Contribution of the Dutch Food Transition Coalition (TCV) and TAPP Coalition, for the SOFA 2024 of the Food and Agriculture Organisation, with contributions of Wageningen University and Research (WUR).

Intro: As mentioned in the FAO study “Beyond the price tag” (‘Examing the hidden costs of agrifood systems to enhance their true value’), there are many hidden costs of the food systems in The Netherlands. Environmental costs are typically emissions and pressures that harm the climate and biodiversity and ecosystems, such as greenhouse gases, nitrogen compounds emissions and land use change. The health costs are mainly related to the unhealthy dietary patterns.

We, the Dutch Food Transition Coalition and True Animal Protein Price (TAPP) coalition, are committed to ‘getting the prices right’, i.e. internalizing external cost one way or another. In order to do so, we have commissioned and carried out a variety of studies in the past 4 years, to obtain a better insight in the external costs of food in the Netherlands and in the EU, and to lay a basis for developing the necessary policy interventions. Due to the high consumption and production of meat and dairy in The Netherlands and the EU, the protein transition is one of the main focal areas.

The first four scientific studies have a quantitative approach. The fifth study (TCV) is a qualitative study based on different studies and interviews, and offers a conceptual framework for implementing policies, depending on goals and on estimations of the impacts of different instruments.

It is a well-known economic fact that if prices do not reflect the full environmental, social, health and (animal) welfare effects, production and consumption patterns are suboptimal, leading to lower prosperity level than what would be feasible. For achieving a long-term sustainable food and agriculture system, it is therefore vital to correct pricing mechanisms. We have been raising this issue on three levels, and the true cost/true value accountancy approached can be applied on various levels:

• Macro-economic, in the form of social cost-benefit analyses
• Meso-level: applied to specific sectors, chains, and areas
• Micro-level of products, mostly known under the name of ‘true pricing’

Throughout these levels, adequate policy instruments need to be discussed and developed. Action on all levels is needed.

This approach, system levels and various policy interventions, offers a workable agenda and framework for further action, that can be applied in many (FAO) countries.

Hidden costs, unlocked values

The name ‘hidden costs’ refers to costs not visible for public and policy makers. That’s why it is necessary – just like in SOFA 2023 – that these costs in food systems are explicitly mentioned in policy papers. In many other sectors, like energy and transport, studies of hidden costs started already more than 30 years ago. In the Netherlands the last 10 years different kind of studies have been done to make these hidden costs in the food chain more explicit.

External costs of dairy and meat can be substantial, ranging between the € 0.34 for a litre of milk to over € 10 per kg of beef (https://cedelft.eu/publications/pay-as-you-eat-dairy-eggs-and-meat-internalising-external-costs-of-animal-food-products-in-france-germany-and-the-eu27/)

Food systems are now designed for 'plenty and cheap', which is made possible because the societal costs (nature and environment, unhealthiness, and animal welfare) are shifted to third parties, the taxpayer, nature, and the future.

Next to ‘hidden costs’, also ‘hidden values’ can be distinguished: food and agriculture can also contribute social value like landscape, water management, carbon storage, biodiversity restoration and the like. It is vital that society starts paying for producing these values, which also gives space to start pricing the hidden costs.

Instruments

The nature of the agricultural and food issues and the negative effects that the current system entails a call for a fundamentally different way of pricing and rewarding.

Revision and development of financial and fiscal incentives are thus an indispensable toolkit in the agriculture and food transition, as is also recognized in the recent FAO Roadmap to climate neutral agriculture, and in the EU Farm to Fork Strategy (Green Deal for Agri-Food). Financial and fiscal incentives offer the possibility of gradual, affordable, and proportional guidance so that a 'managed' transition can be designed.

The Dutch Food Transition Coalition (TCV) and the TAPP coalition are now focused on policies and instruments to reduce the hidden costs, and to abolish perverse subsidies. In particular, we focus on the effectiveness of financial instruments.

The so-called planetary boundary factors are promising foundations for pricing, particularly greenhouse gases, nutrients (nitrogen compounds, phosphate), water use and water level management, chemical substances (pesticides), and (change in) land use (intensity, destination).

For reducing greenhouse gasses in western countries, a reduction of the consumption of meat and dairy products is crucial. To stimulate the protein transition to more plant-based diets is an essential priority of our work. That’s why quite some studies demonstrate the impact of taxes on meat and dairy to reduce the consumption of meat and dairy.

Eating less red and processed meat is also interesting for improving public health of people (Health costs of 7.5 euros per kg of red meat overconsumption - True Animal Protein Price Coalition (tappcoalition.eu), inspired by the report ‘Health motivated taxes on meat’, showing optimal meat tax levels benefiting health and reducing health costs in 149 countries.

Depending on the context and conditions of a country, a selection of instruments has to be made. Public support for financial instruments is limited when prices of food will increase by these instruments. Complimentary policies will be necessary to get public support for financial instruments. Rewarding true value can be such a policy, but there are others too. Governments should make clear what will happen with the tax revenues. We call it “recycling of revenues”. For example, a levy with a rebate can accelerates a transition on two fronts: the inputs and impacts side on the one hand, and the conservation and protection side on the other (e.g. subsidizing farmers to reduce emissions and reducing taxes for healthy, sustainable food products or compensating low income groups). In this way, tax revenues on external costs (the ‘bads’) can be used to stimulate reducing impacts and restoration (the ‘goods’). This interplay provides perspective and ensures sustainable earning models for farmers, as well as for other links in the agriculture and food chains. Part of the tax revenues could also be recycled for climate funding for the new UN Loss and Damage Fund to compensate low income countries for the damage partly caused by overconsumption of meat in OECD countries.

To give an example from Dutch Policy development: during nearly one year the Agriculture Ministry negotiated with farm- and food organisations about an Agriculture Agreement. In the draft Agreement, 600 million euro per year climate- and nature payments to farmers were proposed for ‘hidden values like ecosystem services’. The proposal was to pay this from a consumer tax on meat products.

 Final remarks

Every country has a specific context with different conditions. Studies and analysis of the most important food chains and the impact of these food chains in a country is necessary.

For preparing policies creating awareness on these hidden costs is essential, for instance with public information campaigns and supermarkets starting campaigns with the ‘real’ prices of food including all environmental costs, like the German supermarket Penny did one week with 10 food items in all stores (meat and dairy two times higher in price). Communication and dialogue on facts and figures support the creating of awareness. A clear political committment and leadership to start with policies on hidden costs is needed. Politicians in western countries do it already 15 years very successfully in the energy sector (CO2 taxes, ETS), why not too in the agri-food sector? The insight that huge figures for externalities actually imply a substantial prosperity loss for society as a whole can trigger urgency and action.

In our opinion policies focused om reducing external costs will stimulate a more efficient use of natural resources (nitrogen, fertilizer, land etc). And a careful use of natural resources is important for food security in the future.

Our studies (see Annex) are supporting policymakers and stakeholders in the food system to reduce the hidden costs. Also food companies realise the necessity to respect the planetary boundaries and - due to the CSR policy of Europa – are taking more steps to reduce the hidden costs of their suppliers.

Studies: (Are discussed in the annex).

1. Value Case 2023. The societal impact of protein transition. Study by WUR (Wageningen University and Research), commissioned by TCV:
   
   https://research.wur.nl/en/publications/maatschappelijke-impact-van-eiwittransitie
2. ‘Eat as you pay dairy, eggs and meat’, 2023. Study by CE Delft commissioned by TAPP Coalition. https://cedelft.eu/publications/pay-as-you-eat-dairy-eggs-and-meat-internalising-external-costs-of-animal-food-products-in-france-germany-and-the-eu27/
3. ‘Sustainability Charge on meat’, 2020. Study by CE Delft, commissioned by TAPP Coalition. https://cedelft.eu/publications/a-sustainability-charge-on-meat/
4. ‘Consumer health -True pricing method for agri-food products’, 2022, Study by WUR (Wageningen University and Research) and True Price, commissioned by TAPP.  Health costs of 7.5 euros per kg of red meat overconsumption - True Animal Protein Price Coalition (tappcoalition.eu)
5. “Rewarding and Pricing”. Rewarding and Pricing - Shifting Financial and Fiscal System Incentives from Farm to Fork  TCV Study by Jan Paul van Soest and Tom Kools (Rapport-Belonen-en-Beprijzen-van-Boer-tot-Bord.pdf (transitiecoalitievoedsel.nl)

Joost de Jong, Jeroom Remmers, Jan Paul van Soest.

With support of Willy Baltussen of Wageningen University Research

Dutch Food Transition Coalition is a multi-stakeholder coalition of Dutch frontrunners in the field of agriculture, food, nature and health who strive to shape and speed up the transition. We are a coalition of approx. 200 peoples and parties: Our mission: A healthy life on a healthy planet.

TAPP Coalition (True Animal Protein Price Coalition) is a non-profit foundation, focused on fair food prices and taxes including external environmental and health cost to make the production and  consumption of meat and dairy more sustainable. We are a coalition of 60 food companies and organisations working in the field of health, agriculture, animal welfare, environmental or youth, representing 1,5 million people and 3000 companies (EU, USA, Africa).