The unique business model within farm production requires restructuring.
Farmers operate a business model which doesn’t exist in any other sector, nationally or internationally. We buy in all our inputs at a retail price and bring our produce to market at a wholesaler price.
This leaves all farm production at a considerable disadvantage within the various food chains from farm gate to consumer. All other stakeholders in the food chain operate the normal corporate model of buying in inputs at a wholesale price, adding in a cost of further processing plus a margin and ultimately selling on at a retail price.
The only way I believe we can square this circle is to index-link the retail price to the production costs plus a margin at the farm gate. The current mantra we are hearing over many years from the retailing sector is that consumer demand drives prices, which is true, but this B2C (business to consumer) model does not take into account the unique business structure that farm producers are obliged to operate within.
So in summary we need to restructure the farmer producer element of our current food production model to acquire a fixed percentage of the consumer price by indexing it to production costs plus a margin within the farm gate.