Urban Food Chains

the links between diet and power

canning food manufacture France
Footnote on the protagonists in Time Travel for Food
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Leadership is something we all respond to and it takes many forms.

Take a figure from history, such as Napoleon Bonaparte. A product of the ruling elite of his day, Napoleon underwent officer training and was undaunted by meeting calls to define the working structure of a post revolutionary state from scratch. The Codes Civils (sometimes referred to as the Napoleonic Codes) were an object lesson in structuring the edifice of a state at the start of a post-royal era (https://urbanfoodchains.uk/forging-urban-food-chains/). Bonaparte had the outward signs of a civic visionary and expected to lead from the front.

Employing a completely different set of skills, Nicolas Appert perfected the system of sealing food into bottles or cans and cooking it so thoroughly that the product would keep indefinitely. Sometimes referred to eponymously as Appertisation, the process has been used with very few changes, for more than two hundred years. Appert predated fellow Frenchman Louis Pasteur by just over 60 years and would not have predicted the link between heat treatment and killing pathogens that Pasteur would make in years to come.(https://urbanfoodchains.uk/time-travel-for-food-2/)

There are grounds to suppose that the Appertisation process was known to food producers, but not widely practiced in the 1790s. In place of a theoretical explanation for the incontrovertable success of the process, Appert constantly ran tests on batches of food, using bottles and stoppers of all sorts of material: ceramic, glass and metal. As the years progressed, his confidence in the process grew, as he learnt what cooking times different foods needed in a water jacket of boiling water. Nicolas Appert had been raised by an inn keeper working in Chalons-sur-Saone and was a competent chef. His entire working life was focussed on feeding people and by the 1790s Appert was working as a confiseur in a Paris suburb.

A confiseur is someone who cooks off food, usually with boiling water, to make range of “confits” or foods almost cooked to a mush. Confiserie refers to boiled sugar confectionery, while confits are table-ready dishes which can be sweet or savoury and typically capped off with a layer of fat. The aim is to cook off seasonal gluts, although meat-based confits had short shelf lives, since the melted grease did not offer any real protection to the dish. This was the reason for Appert’s interest in sealing his wide-necked bottles, in a bid to extend shelf life. Appert successfully got reliable results, which is why Appertisation is referred to as “Time Travel For Food” on this website.

Appert plied his trade as a confiseur and wholesale grocery from a workshop in rue des Lombards. He was a member of the militant Section des Lombards, who mobilised at moments of crisis during the revolution in Paris. An active Jacobin, Nicolas and his wife Elisabeth supported the revolutionary cause in practical ways, such as holding planning meetings in the workshop.

As readers will learn in the short history of Nicolas Appert, the confiseur was pulled into the Jacobin Terreur, saved only by the fact that Robespierre was executed 36 hours before Appert was due to go to the scaffold. The Appert household survive the latter years of the revolution: Nicolas is awarded an “encouragement” of 12,000 gold coins by Napoleon. This comes with a requirement to publish a manual to Appertisation at his own expense. Appert remained politically active during his life and was elected mayor of Ivry-sur-Seine.

Appert also makes a trip to England in 1814, at the height of the Napoleonic wars. The reason for the trip was for after-sales support for an English engineer who had licenced the process for commercial exploitation. The technology transfer had been overseen by Pierre Durand, a Bordeaux wine merchant turned intellectual property agent. Durand’s leadership style was simply blunt and overbearing. He met his match, however, in Bryan Donkin, his English client.

A highly regarded engineer, Donkin had undertaken  work for the Fourdrinier brothers, Henri and Seely, to make their purchase of a design for a papermaking machine work in a paper mill environment. As his French clients faced bankruptcy and Donkin still had a workshop to keep in production, there was a pause in proceedings during which Donkin tried to stake a claim on what is known today as the Fourdrinier papermaking machine. Resourceful as ever, Donkin contrived to settle the name of the machine on the brothers, but retained control over the crucial detail that allowed him to  sell working papermaking machines in his own name. Since he installed almost 200 machines across Europe, one can suppose that he was commercially successful. It should be added that Donkin also patented the dip pen and a number of nib designs, which generated far greater sales than could be earned from selling a papermaking machine. This management style is close to opportunistic, but shows a high level of resourceful thinking. Bryan Donkin’s grandson, called Bryan after his grandfather, developed and patented the Donkin gas valve, which is more widely known than Donkin senior’s achievements.

retail UK UK economy
Grocery Code Adjudicator: inaction in action
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Not long ago the Grocery Code Adjudicator’s office published its report for the past year. The reality behind the lukewarm prose is more disturbing than might first appear: the complaints raised are predictably familiar and there are multiple labels for what appear to be depressingly perennial abuses. More to the point, given the confidentiality of the process, it is not possible to determine an order of magnitude for the sums involved. This is not just a nice-to-have ballpark figure, but a true measure of the scale of a continuing problem.

Click image to download jargon buster

The presentation and figures can be downloaded here. There are a good two dozen descriptions for the issues that have been raised by suppliers. The rates of change given for year-on-year complaint numbers are within five or six percent of the previous year, which is supposed to mean that everything is under control. The message is a very firm “…nothing to be seen here. No, really, THERE IS NOTHING to be seen here…” Yet the sort of practices that suppliers are complaining about would normally merit criminal investigations. Or would insisting on the letter of the law just put suppliers out of business?

Those who have been in the food industry for years will have acquired a collection of tales of extortion and graft that at first hearing seem overstated, but which become hard to ignore or dismiss. A lifelong food industry veteran put it this way: “The multiples have been running circles round the government for years. It’s been going on for decades. These days retailers are so used to demanding money left right and centre that it’s hard to know how they keep track of their real costs.”

It is well nigh impossible to assign an order of magnitude or give a steer on how serious the ongoing abuse might be in the grocery trade. Let us be as circumspect as possible in unpacking this one. Let us assume, for instance, that there is only one instance of a dispute under any of these headings and that the percentage figure, rather than referring to a case load, is a crude measure of the sums of money involved. Anything bolder than that would suggest a totally compromised food industry. Don’t rule that out, by the way.

Now take the following two GCA sub-headings as examples:

(a) Requests for payments to keep your existing business with a Retailer (pay to stay)

(b) Requests for lump sum payments relating to Retailer margin shortfall not agreed at the start of the contract period.

These both look suspiciously like blackmail, but let’s try to estimate an order of magnitude for these actions. Shelf money demands are usually based on a fixed sum per SKU per product range, for a listing across two to three hundred sales outlets. To get an idea of the sums of money that can be involved, assume the product concerned costs one pound and comes in five flavours and three pack sizes (sub-total 15 SKUs). Pull a pay to stay value out of thin air of GBP 5000 for each SKU listing across 250 sales outlets, fifteen SKUs times GBP 5000, guesstimate budget GBP 75000. If the retailer has a markup of 20p, the pay to stay demand is equivalent to a supplier “giving” 375,000 units of product (20p times 375,000 = GBP 75,000). While it is not unheard of for retailers to withhold all or part of an invoice, it is not in the suppliers’ interest to hand over lorryloads of product, which will earn the retailer the full retail price at the checkout: literally having their cake and eating it.

Given that a hypermarket can easily have up to 20,000 food SKUs, not counting own-label lines, you could end up with an aggregate demand for shelf money running to millions of pounds if they were all to be counted towards a shelf money Christmas list. Given that these are very large wadges of money to conceal on a balance sheet, our imaginary retailer will probably need all the accounting strategies they can think of to hide the true state of the cash flows. Again, to avoid overstatement, we will assume that each heading only refers to a single instance of a commercial abuse.

In choosing a theoretical sum of GBP 5000 per SKU for shelf money, this could be seen as an exaggeration. However, one simple factor ramping up shelf money demands is the simple proliferation of the high street formats for mainstream food retailers. It is highly improbable that a retail multiple would forego an established shelf money framework when opening high street stores. However, competing convenience stores simply do not have the kind of clout that a major multiple can bring to bear on brand owners in a store format that leans heavily on established brands.

The office of Grocery Code Adjudicator was set up about 20 years ago and spent about half that time building up its role as a trusted arbiter, a lap dog rather than a watchdog. It is hard to imagine that it has done more than scratch the surface of the very real problems facing food manufacturers and brand owners in their dealings with a clique of very powerful customers, the multiple retailers.

France livestock
Forging urban food chains
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France in the closing years of the 18th century was in total chaos. The Terreur (terror) reached its height with the execution of the Jacobin leader Maximilien Robespierre in the summer of 1794. In the years that followed, the Consulate took control led by Napoleon Bonaparte. The young Napoleon set himself the task of clearing away all the old laws and the rag-bag collections of local regulations (“coutumes”).  He replaced them with the “Code Civile” that set out the rules for a constitutional reset.

The code was secular and written in ordinary French. It detailed what was expected of citizens — considering men to be equal before the law, while assigning women the role of dowry-bearers, facilitating the transfer of property and assets between families. Because of the contractual importance of marriage, there were elaborate requirements to ensure that men were legitimate before they could be married. The husband owned his wife’s dowry, but not her paraphenalia.

The code also laid out commercial frameworks and set standards for product liability. For instance, artisans and craftsmen were required to give a ten-year guarantee on their work. When selling land, sellers were obliged to include the oxen teams and equipment needed to work the land. And those acquiring livestock with a farm were required to keep the animals exclusively on that farm, keeping the dung on the holding. It is worth remembering that rural France was heavily  populated in those days, but over the coming century, this was about to change. The Code applied to both town and country, as well as to those on their travels. For example, innkeepers had a legally enforceable duty of care for their guests’ goods and chattels, which extended to those working on the premises, protecting them, too, from light-fingered interlopers.

The March 1804 version of the Code Civile had more than 1800 paragraphs and was the largest version to be put up for adoption. There were prolonged debates about all three circulated versions, each with different numbering and paragraph counts. Some of the articles in the Code Civile still apply to this day, often heavily modified. The administrative commitment to a document-based system put a greater priority on literacy. Deaf or visually challenged citizens who could read had protected access to the provisions of the code unlike non-readers who made their mark to sign off  documents they could not read.

Brexit's legacy
More like a CET piece than a new start
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When the UK government started to work on its replacement for the Common European Tariff, it quickly became clear that nobody, least all the ministers in charge of the process had much idea of what needed to be done. They not only lacked a plan, they didn’t have a clue…

There is one tariff tweak in the UK schedule that makes sense: 0803 90 10 fresh bananas. In the CET this is set at EUR 114/100kg, to protect French banana growers in the Caribbean. For the UK Schedule, this duty has been revised downwards to GBP 95 / tonne in the UK schedule, reflecting the sort of opportunities that are available to a new third country. But it is an isolated example

 
A lot of commonplace ingredients remain barely touched, however. Take garlic, 0703 20 00: it faces an 8% ad valorem plus GBP 100/100 kg in the UK Schedule. Quite why the UK, which has no high profile garlic growers north of the Solent, should seek to make consumers pay through the nose for it, is a valid question. It may just turn out that Westminster needs the money and minimising the changes in the CET will generate a steady income stream. But that’s not what British voters were told to expect. For those who embraced the message “…sit back and enjoy the ride…” it is time to wake up and ask awkward questions. Like: “What’s going on with the economy?”

There is an oddity in Chapter 16, where three codes for luncheon meat get widely differing treatments for what are very similar industrial food products. Beef luncheon meat in cans (1602  90 69) attracts 16% ad valorem; porcine luncheon meat (1602 49 30) GBP 71/100kg, while 1602 31, turkey luncheon meat, faces duty at EUR 102.14/100kg or around GBP 1000/tonne. 
The UK online product description at the time of writing (June 2023) talked of an undercooked canned product that would fail every food safety check in the book. The whole point of the Appertisation process is that food undergoing the process is fully cooked to the core of the product. There is no such thing as a little bit unsafe in canning: it either is or is not fully cooked. Botulism is not a forgiving disease.

Brexit's legacy
Why Brexit is a real mess
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Boris Johnson promised the earth at the last election but what he delivered was a complete shambles. A key Brexit document is Schedule XIX, which lists all the tariffs for UK imports and the conditions that apply to them. Look a bit more closely and you will see that it is in fact still a lightly edited version of the Common European Tariff (CET). It has been retained from the UK’s days as an EU member state and transferred into British policymaking for Brexit without any real thought about what it should achieve. For a start, it is still designed for member states to keep control of third country imports. In one sense, this should come as no surprise, since the CET is in force for all member states of the European Union, including the UK until Brexit. It would have been reasonable to suppose that an historic change in UK economic policy should have been matched by a political and procedural vision to make it fit for purpose. No chance.


If the whole point of Brexit was to break free from the European trading bloc, a failure to adapt the CET to fresh trading perspectives is more than a basic oversight. It is a fatal flaw. The roots of the CET are in the mechanistic visions of the 1970s to make third country imports uncompetitive against subsidised EU products. It is not constructed to serve third country interests without a lot of serious modifications. Since Brexit was regarded as the grandstanding opportunity of the century, none of the politicians who invaded the nation’s TV screens ever thought about such unimportant procedures as tariffs.

The CET contains tariffs that combine ad valorem percentages and flat rate payments in Euros, reassigned to GBP. These were best guess estimates of the day as to how much money the EU had lavished on an agricultural commodity before it reached the end user. This economic anachronism has been more firmly embedded into the UK economy without a second thought for what the UK might need from a tariff in years to come.

A cursory look for changes to the CET in its transition to Schedule XIX yields a few surprises: the schedule document I downloaded from gov.uk has no Chapter 03 (fish) and goes directly from the end of Chapter 02 (meat and offal) with the line CN 0210 90 90 “Edible flours and meals of meat or meat offal” straight to Chapter 04, listing dairy products. The missing fish chapter is complemented by a gap in Chapter 16, (PREPARATIONS OF MEAT, OF FISH OR OF CRUSTACEANS, MOLLUSCS OR OTHER
AQUATIC INVERTEBRATES) which only lists terrestrial species. Chapter 03 (fish) was restored in the version issued by Hansard: It was still denominated in Euros, but a redenomination into GBP had been scheduled.

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In a report to the European Parliament, Irina Popescu and Frederik Scholaer observe that the UK has always believed its fishing fleet was being short changed by European fisheries policies. Repeated claims that European proposals would threaten “vital national interests” were made throughout the six years of negotiations that finally led to the Total Allowable Catches system (TAC). The UK fishing industry persists in blaming the rest of the world for reduced catches, but one has only to look at archive photographs of postwar trawlers with nets full to bursting to wonder why anyone should imagine fish stocks are inexhaustable. Popescu and Scholaer allude to a sense of grievance that found resonance with numerous Brexit campaigners and their talk of “taking back control”.

British attitudes to fishery access is at best ambivalent. Since the early days of accession to the EU, UK boat owners have cheerfully sold fishing quota and whole fishing boats to foreign operators. Referred to as “flag ships*”, these vessels are captained and crewed by foreign nationals and sail to catch fish on UK quota allocations, also sold on for the purpose. Contrast this with the vitriol and bad blood reserved for foreign fishing crews and it quickly becomes clear that there will be no quick fixes for the UK fishing sector.

Brexit has raised demands for additional border checks. There are a number of longstanding verbal commitments to implement Sanitary and PhytoSanitary checks (SPS), which are to be carried out in standardised Border Control Posts (BCPs), previously known as Border Inspection Points or BIPs. A July rollout has since been pushed over into October. There are pivotal crossings passing through privately-owned ports, such as Craigryan. This leaves the UK government imposing a future requirement for border checks for fish and animal products at internal borders. Port operators are not alone in their insistence that this is unfair, even though it’s a legal requirement. EU parliamentarians Irina Popescu and Frederik Scholaer cited the objections made by Scottish salmon producers to procedures that could add up to GBP8.7 million a year to their operating costs.

The last-minute signing of the Trade and Co-operation Agreement (TCA) on December 30, 2020, was a keystone in the Brexit edifice. It marks an uneasy peace for the fishing sector. The small print gives both parties six and a half years to redefine the terms of the TCA, so even though it is a done deal it is not set in stone.

Brexit's legacy UK economy
Pounds, pence and Euros
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If current headlines (week 24, 2023) about the turmoil in the Conservative party appear serious, wait until the parlous state of the UK’s unfinished Brexit arrangements come home to roost. History will judge those responsible, but the UK population will pay the price. Having copied and pasted the Common European Tariff into the UK economy, ministerial hands have been fiddling with some of the detail, but not with any visible signs of understanding what they were about.

As one might expect, the Common European Tariff is haunted by a number of ghosts in the machine. These are mainly mechanisms that protected former cornerstones of the Common Agricultural Policy from third country imports. With some dating back to the 1970s, these tariffs were supposed to make subsidised EU agricultural products competitive on the internal market against third country goods. Many of the tariffs are ad valorem percentages, but most of the politically sensitive sectors supported by the CAP are made up of an ad valorem percentage and a flat rate payment per 100kg in Euros, redenominated in GBP.

Third country olive oil arriving in the EU still faces a flat rate duty of EUR 124.50 per 100 kg. For some years now, there have been trade deals with third countries such as Tunisia, which establish a duty-free quota for EU packers. This olive oil can then be traded freely within the EU.

Under Rules Of Origin (ROO), however, any third country olive oil arriving in the UK is liable for duty at GBP 104 pro rata in blends, converted into sterling at around 85p to the Euro. Now the UK has no indigenous producers of olive oil to protect from competitive pricing of third country oils and ministers could have cheerfully set the duty to zero.

All the schedule XIX money values appeared in Euros before Brexit, as they did when the document first appeared in the summer of 2018. For its UK enquiries, HMRC works in pounds and pence. The transfer of Schedule XIX to Sterling was carried out by the WTO (World Trade Organisation) but there remain a lot of unresolved issues that will take a lot longer to resolve than Brexit. With more than 160 members, the WTO’s insistence on consensus makes bluster and confrontation counter productive. Brexit negotiations were shot through with contempt for consensus on the British side. In Geneva it doesn’t wash.

canning fish France sardine
Packing them in
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An unmistakeable sign of the impending holiday season turned up this morning in the form of an email from Thierry Jourdan, boss of the family-run cannery La Quiberonnaise in Britanny. Founded in 1921 by Thierry’s grandfather, the fish canning business packs sardines and mackerel landed by local inshore boats as well as taking in yellowfin tuna to pack a range of cans in domestic sizes.

Such canneries were a common sight in seaside towns during the first half of the twentieth century. Today, there are still a number of survivors in what used to be a crowded market. As the fleets dispersed and catches waned, the importance of the tourist trade was recognised by canneries along the French coast. The 1930s saw the establishment of paid summer holidays for French workers: it was the salvation of resourceful canners.

They greeted holidaymakers with open arms and tasteful souvenirs. Local artists are still engaged to create designs for annual editions of elaborately decorated cans of fish, with the promise of a fresh series the next year. Themes range from gently humorous picture postcard subjects to classical offerings that are as likely to end up in an art gallery as a kitchen. Canned fish as an art form has some unexpectedly well-known devotees. Food critic Jean-Luc Petitrenaud always takes a decorated can of sardines for his host whenever he is invited to dinner.

olives
Growing demand
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Source: Intrastat

Total imports of Spanish olive oil to the UK topped 92,000 tonnes in 2021. That includes retail products, industrial, pharmaceutical, food manufacturing and UK-bottled own label product. The only tonnage it leaves out is olive oil sold by Lidl and Aldi. That represents a lot of demand for physical stock. Over the past decade it has climbed from 70,000 tonnes, with a wobble caused by high fuel prices in 2018.

olives
Olive oil by numbers
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The UK has been a strong market for olive oil in recent years, in a world where consumers are spending more than 14 and a half billion pounds a year on the Mediterranean’s most important crop. UK consumers will be paying rather more than their European neighbours in the coming months. They already pay over the odds, as it is.

The UK market caters for small introductory purchases: 250ml bottles currently retail for GBP 2.45p for olive oil, GBP 2.55p for EV (Sainsbury on June 1), while a Tesco 250ml bottle of bland mild and light olive oil has risen by 18% over the past year to GBP 2.83p. Tesco pricing for a litre of leading brand EV has risen steadily over the past 18 months by 50% from GBP 6.95p to GBP 10.40p, while ASDA increased the shelf edge price for the same branded litre of EV from GBP 6.50p to GBP 8 on June 1.

As of June 1, the ASDA shelfedge price for a one litre bottle of Filipo Berio EV went up to GBP 8, while Tesco was asking GBP 10.40 for the same product. It is safe to suppose that ASDA was not selling this line at a loss. So “every little helps” Tesco is charging 30% more than its rival. The day before, the differential was 60% for the same stock on the same shelves in their respective stores.

At a nearby town centre branch of Iceland during the same store check, the olive oil category was a one liner in every sense of the phrase. It comprised a single SKU, 500ml of ordinary olive oil for £4 in a tertiary brand, packed in a tidy plastic bottle. A no-frills distress purchase.

UK grocers selling olive oil have been milking the category. Spanish consumers get through a per capita average of 10 litres a year. They know what it’s worth and expect to get value for money. At the moment, headline olive oil prices are rising and are close to EUR 5,500 a tonne for EV grades. UK retailers will have to rethink their margin expectations if they are going to secure product and continue selling it. The party’s over, guys.

Brexit's legacy key concept olives
Rules Of Origin (ROO)
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Goods that combine components from more than one trading bloc are subject to the Rules Of Origin procedure. Goods made in the EU are zero-rated on arrival in the UK, while the status of duty payable on third country components or ingredients used in EU goods is determined by applying Rules Of Origin. These establish whether or not the third country component has been transformed sufficiently for it to be considered an integral part of a new product. If it is a fellow traveller in a blended product, for instance, it is liable for duty.

The first target is to ascertain whether or not the component concerned has been absorbed into the finished EU product. If so, it can usually be covered by the duty payable on the finished product. If, on the other hand, it can be recovered from or identified within the EU product, the third country component may be liable for third country duty pro rata. The key marker is whether or not the third country component qualifies for a change of customs code. This will be decided by the UK customs staff on a case by case basis.

In the case of third country extra virgin olive oil (1509 2000), it is considered a fellow traveller in a blended product. This currently stands at 104 gbp per 100kg, according to the UK government online tariff service, https://www.trade-tariff.service.gov.uk/subheadings/1509200000-80 (as of check made on May 29).