The future of farming must be consumer-led, not production-driven, says Sainsbury’s chief executive Justin King.
Delivering the annual Bledisloe Lecture at the Royal Agricultural College, Cirencester, Mr King was highly critical of production subsidies and gave an impassioned defence of capitalism, saying that artificially supported, unviable businesses harmed more successful enterprises and must be allowed to fail.
“It is vital that consumer behaviour is of interest to you [farmers],” he said. “It seems to me that for too long, agriculture has been production-led. In a sustainable world, agriculture must be consumer-led. We all need to be clear about what consumers want.”
There was no doubt the worsening economic situation was making consumers alter their behaviour in favour of fewer ready meals and bargains, but he said shoppers remained committed to local, ethically produced food. “This is not the same as down-trading. Shoppers are definitely not compromising their values.”
Mr King said Sainsbury’s had formed close relationships with many of the farmers who supplied it. “Supporting British farmers is about more than simply stocking their products. It’s about working with them to raise their capability and skills so they can develop sustainable business that can continue supplying us with the products our customers want to buy.”
Mr King pointed to the success of Sainsbury’s Dairy Development Group of 350 dairy farmers and said the retailer had plans “in development” for similar arrangements with groups of beef and sheep farmers.
However, he said Sainsbury’s made no apology for trading and supporting farmers in the developing world, too. “We believe in being fair to farmers at home and abroad.”
- Sainsbury’s sales in the first half of the year grew by nearly 4% despite the difficulties in the wider economy pinching consumers’ pockets. The retailer’s interim results were at the top end of expectations, with pre-tax profits growing 11% to £258m for the 28 weeks to 4 October. Turnover was up 7.4% to £9.94bn.