Amsterdam, 11.11.2024 – True Price has contributed with its expertise to the FAO ‘State of Food and Agriculture‘ (SOFA) Report. In recognition of its leadership in sustainability, True Price’s work has been cited as a practical example of how true pricing can help foster a more sustainable and just food system.
The FAO’s State of Food and Agriculture 2023 report offers key recommendations to address the hidden environmental, social, and health costs in agrifood systems. The main recommendations include strengthening governance and regulatory frameworks, enhancing stakeholder engagement, and aligning innovation with robust policies for sustainability. Consumer behavior is highlighted as crucial in driving food system transformations, while global cooperation is essential to ensure equitable outcomes.
True Price’s participation in the expert panel providing input into the SOFA report underscores the increasing global recognition of the need to integrate the hidden costs of food—such as environmental and social impacts—into market prices. This approach empowers consumers and businesses alike to make more informed decisions that prioritize sustainability, enabling a shift towards more resilient and equitable food systems.
The SOFA Report presents significant findings, including insights into the hidden costs within global agrifood systems. As outlined in last year’s edition, these hidden costs exceeded $10 trillion in 2020. This year’s report refines the global True Cost Accounting (TCA) assessment and explores how different agrifood systems can adopt actionable pathways for change through extensive stakeholder consultation. The report calls for targeted policy actions to reduce these costs, ultimately contributing to the transformation of food systems worldwide.
A key takeaway from the report is the importance of adopting TCA as a means of revealing and addressing the environmental, social, and health costs linked to food production. These costs are analyzed through the lens of agrifood system typologies, ranging from protracted crises to industrialized systems. By focusing on specific contexts, the report offers tailored policy recommendations aimed at reducing negative impacts while promoting positive systemic change.
True Price’s work with companies like De Aanzet and Van Vessem Bakery in the Netherlands is highlighted as a successful example of true pricing in practice. By incorporating the hidden costs of production into their products, these organizations are not only promoting sustainability but also fostering stronger connections between consumers and producers. This approach enhances consumer awareness and makes sustainable food options more accessible, aligning with the FAO’s call for sustainable food systems transformation.
The report also examines the significant health hidden costs linked to unhealthy dietary patterns. For example, diversifying agrifood systems could face health hidden costs amounting to 10% of GDP due to the rise in non-communicable diseases (NCDs). As the report emphasizes, food systems transformation cannot be achieved without addressing these underlying health costs, further highlighting the need for a comprehensive approach to agrifood systems reform.
The true pricing model can also facilitate gradual behavioral change. Unlike taxes, which may face resistance, true pricing provides transparency about the reasons behind price increases, offering consumers the choice to support sustainable production. Over time, this could lead to a larger shift in consumer behavior, as demonstrated by Vermaat, a leading catering company in the Netherlands, which saw a 20% reduction in meat consumption and a sevenfold increase in vegetarian dishes after introducing true pricing.
For true pricing to be fully effective, however, it must be implemented across all food products. By ensuring that the true costs of all products are visible, consumers can make more informed choices that support sustainability and fair trade.
The FAO’s State of Food and Agriculture 2023 emphasizes that the transformation of global agrifood systems requires a multifaceted approach, which includes improved governance, stakeholder engagement, and clear regulatory frameworks. True pricing fits squarely into this strategy, as it ensures that hidden costs are addressed, thereby contributing to a fairer and more sustainable food system.
True Price remains committed to supporting the transition toward a more transparent and equitable food system. By highlighting the true costs of food, we can drive long-term positive change for both people and the planet.
About True Price:
True Price is an organization dedicated to advancing the concept of true pricing—where the hidden environmental, social, and economic costs of products are incorporated into their prices. By making the true cost of food visible, True Price aims to empower businesses and consumers to make more sustainable decisions, leading to a fairer and more just global food system.
