Sustainable finance for sustainable agriculture and fisheries

Project Information

SUFISA

Grant agreement ID: 635577

DOI

10.3030/635577

Project closed

EC signature date 19 February 2015

Start date 1 May 2015

End date 30 April 2019

Funded under

• SOCIETAL CHALLENGES - Food security, sustainable agriculture and forestry, marine, maritime and inland water research, and the bioeconomy

Total cost

€ 4 863 662,50

EU contribution

€ 4 863 661,75

Coordinated by

KATHOLIEKE UNIVERSITEIT LEUVEN
Belgium

Periodic Reporting for period 3 - SUFISA (Sustainable finance for sustainable agriculture and fisheries)

Reporting period: 2018-05-01 to 2019-04-30

Summary of the context and overall objectives of the project

A good functioning of the European food system is key to deliver food and nutrition security, but primary producers face difficult financial conditions, while beiing highly dependent on policy requirements as well as input and output market conditions. SUFISA aimed to:
• To construct a conceptual framework that links market imperfections and policy requirements to primary producers’ conditions, strategies and performance;
• To investigate the nature of market imperfections, policy requirements and their implications for specific commodity sectors and regions;
• To analyse the impact of market imperfections and policy requirements on the efficiency and performance of primary producers;
• To identify practices and policies in the agricultural, fish and food sectors that support the sustainability of primary producers and develop future scenarios aimed at countering the identified market imperfections;
• To carry out work in a transdisciplinary way using a multi-actor approach, that is, to actively engage a broad spectrum of relevant stakeholders from the beginning of the project in order to optimise both the relevance of the work carried out and its dissemination and uptake by stakeholders.

The results of SUFISA are based on qualitative and quantitative analysis of 22 case-studies in Europe. Cases and sectors represent a large range of conditions and subsequent strategies and performances. Market conditions are more important than regulatory and policy conditions in affecting and shaping the farming and fishing systems. The historical political context, in particular the level of government intervention, both at the level of the country and the sector, shape producers’ discourse, concerns and expectations. This translates into a higher difficulty to adapt to new market structures and supply chains. Increasing productivity through intensification and upscaling remain the two dominant future strategies, leaving little room to more sustainable or innovative farming activities and marketing strategies. A sequential list of strategies can observed whereby producers would first be rather non-organised, then willing to cooperate within producer organisations and then better coordinate within more elaborated organisational forms such as clubs or vertical integration. Individual production strategies are not sufficient to deal with conditions yet need to be embedded in supportive supply chain arrangements. Ideally, supply chain arrangements imply a combination of vertical coordination, horizontal cooperation and public intervention that mutually reinforce each other. In practice, barriers exist in the development of these elements as well as between them, leading to tensions rather than synergies. These barriers are a result of lack of trust and solidarity but also of opportunistic behaviour of some supply chain actors and lack of competences related to marketing and distribution, particularly at the producer level. While legislation on unfair trading practices is tackling opportunistic behaviour, more needs to be done to successfully design supply chain arrangements that integrate vertical coordination, horizontal cooperation and public intervention in a synergetic, inclusive and efficient way.

Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far

1. CONCEPTUAL FRAMEWORK

To generalise regional contexts and to investigate the nature and complexity of market imperfections, policy requirements and their implications for the sustainability and resilience of specific commodity sectors and regions across Europe, SUFISA uses a framework that relates producers’ Conditions, Strategies and Performances (CSP). A key factor influencing and mediating producer strategies and performances, is the way commodities are sold to supply chain actors, such as processing firms, traders or retailers. These selling conditions are embedded in institutional or supply chain arrangements, that is, the rules and agreements that govern exchange relationships. These arrangements can be both formal (contract, law) and informal (trust, reputation), and can consist of both private (buyer requirements) and public (policies) elements. The final conceptual framework has been presented at a stakeholder meeting in Brussels in November 2018, the final conference in Krakow (Poland) and a lunch seminar at DG AGRI in Brussels on 6 May 2019. The conceptual model will also feature in an organised session to be held at the tri-annual conference of the EAAE in Prague, August 25-18, 2020.

2. CASE STUDY ANALYSIS

The nature of conditions influencing primary producers’ strategies was investigated through desk study research, focus groups and a large-scale producer survey. An inventory of all conditions, strategies and performances and their interlinkages was completed for all case studies. This database allows the identification of cross-case patterns of how conditions, strategies and performances are linked. A producer survey was implemented in all case studies, focusing on how institutional arrangements influence producers’ strategies and performances. Results have been published for each case separately, in short policy briefs, and a comparative report and a producer survey report

3. IMPACT EVALUATION

The relation between market imperfections, efficiency variations in the sector and environmental impacts were analysed in an extended efficiency approach, while also the relationship between market power and asymmetric information was investigated.

4. SOLUTIONS AND SCENARIOS

Four food system narratives reflecting on how societal changes could affect the organisation of European food systems in different and contrasted ways, quite independently from agricultural policies and producers’ strategies were developed, based on five main variables: trade policies, global demand for agrifood products, European diets, food chains organisation, and agricultural technology. These scenarios will assist in identifying and developing robust institutional arrangements fostering producers’ performances.

5. MULTIACTOR INVOLVEMENT AND DISSEMINATION

Feedback from stakeholders was sought through a variety of methods, such as social media, videos and workshops. A booklet summarising the project’s main results has been published. All output is available on the website www.sufisa.eu.

Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far)

The development of supply chain arrangements in the agro-food sector is key for sustainability. Better understanding the factors influencing the development of such arrangements enables stakeholders and policy makers to improve existing and design new institutional arrangements, ultimately resulting in the enhanced competitiveness and environmental performance of EU agriculture, aquaculture and fisheries and thus food and nutrition security within the EU.

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