Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Retail-farm price margins growing rapidly in Finland

22.11.2005


The share of the wholesale and retail trade in the consumer price of food has increased rapidly in Finland over the past five years. At the same time, a declining share of the consumer food euro is allocated to farmers, according to marketing margin calculations from MTT Agrifood Research Finland.



Marketing margin calculations by MTT indicate the share of the retail price going to each sector along the supply chain: farmer, processing and trade (=marketing margin) as well as government taxes. The new figures for the period 1999-2004 reveal considerable growth in both unit and percentage marketing margins for many basic food products.

For the most part, the growth in these margins has been progressive. Average percentage margins for meat have grown the fastest. For dairy and grain products, a slightly slower growth is indicated.


Farmers in Finland, in turn, have been receiving an increasingly lower proportion of the retail price of food. The farmer’s share in the price of minced meat, for example, has declined from 33.6 per cent in 1999 to just over 23 per cent in 2004. The farmer’s share for pork chops have declined from 19.4 per cent to less than 15 per cent over the past five years.

Rising marketing margins and a declining share for the farmer have come during a period of considerable change in the structure of both the retail and wholesale sectors. The concentration of the retail sector, with fewer outlets and the growth of the large supermarket chains, has been particularly rapid in Finland. The two leading retail chains of food and daily goods increased their market share from 55 per cent in 1990 to nearly 80 per cent by 2005. The increased concentration of retail power means that large retail outlets now exert significantly more control over others in the food supply chain.

“The Finnish food sector is not alone in witnessing a growth in retail margins. This phenomenon appears to be happening across other EU markets where falling farm gate prices don’t always lead to the fall in retail prices, which increases retail margins.” says Jyrki Niemi, an agricultural economist at MTT.

“This reflects the increased market power of the retail sector, although some other factors, including more value-added at the retail level, including better service and a greater variety, play a certain role as well. There is also evidence of retail price levelling - especially for meat products. Levelling occurs where short-run fluctuations in producer prices are filtered out so as to hold retail prices stable.”

Marjatta Sihvonen | alfa
Further information:
http://www.mtt.fi
http://www.mtt.fi/english/press/pressrelease.html

More articles from Business and Finance:

nachricht Microtechnology industry is hiring – positive developments of past years continue
09.04.2018 | IVAM Fachverband für Mikrotechnik

nachricht RWI/ISL-Container Throughput Index with minor decline on a high overall level
20.03.2018 | RWI – Leibniz-Institut für Wirtschaftsforschung

All articles from Business and Finance >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Powerful IT security for the car of the future – research alliance develops new approaches

The more electronics steer, accelerate and brake cars, the more important it is to protect them against cyber-attacks. That is why 15 partners from industry and academia will work together over the next three years on new approaches to IT security in self-driving cars. The joint project goes by the name Security For Connected, Autonomous Cars (SecForCARs) and has funding of €7.2 million from the German Federal Ministry of Education and Research. Infineon is leading the project.

Vehicles already offer diverse communication interfaces and more and more automated functions, such as distance and lane-keeping assist systems. At the same...

Im Focus: Molecular switch will facilitate the development of pioneering electro-optical devices

A research team led by physicists at the Technical University of Munich (TUM) has developed molecular nanoswitches that can be toggled between two structurally different states using an applied voltage. They can serve as the basis for a pioneering class of devices that could replace silicon-based components with organic molecules.

The development of new electronic technologies drives the incessant reduction of functional component sizes. In the context of an international collaborative...

Im Focus: LZH showcases laser material processing of tomorrow at the LASYS 2018

At the LASYS 2018, from June 5th to 7th, the Laser Zentrum Hannover e.V. (LZH) will be showcasing processes for the laser material processing of tomorrow in hall 4 at stand 4E75. With blown bomb shells the LZH will present first results of a research project on civil security.

At this year's LASYS, the LZH will exhibit light-based processes such as cutting, welding, ablation and structuring as well as additive manufacturing for...

Im Focus: Self-illuminating pixels for a new display generation

There are videos on the internet that can make one marvel at technology. For example, a smartphone is casually bent around the arm or a thin-film display is rolled in all directions and with almost every diameter. From the user's point of view, this looks fantastic. From a professional point of view, however, the question arises: Is that already possible?

At Display Week 2018, scientists from the Fraunhofer Institute for Applied Polymer Research IAP will be demonstrating today’s technological possibilities and...

Im Focus: Explanation for puzzling quantum oscillations has been found

So-called quantum many-body scars allow quantum systems to stay out of equilibrium much longer, explaining experiment | Study published in Nature Physics

Recently, researchers from Harvard and MIT succeeded in trapping a record 53 atoms and individually controlling their quantum state, realizing what is called a...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

VideoLinks
Industry & Economy
Event News

In focus: Climate adapted plants

25.05.2018 | Event News

Save the date: Forum European Neuroscience – 07-11 July 2018 in Berlin, Germany

02.05.2018 | Event News

Invitation to the upcoming "Current Topics in Bioinformatics: Big Data in Genomics and Medicine"

13.04.2018 | Event News

 
Latest News

In focus: Climate adapted plants

25.05.2018 | Event News

Flow probes from the 3D printer

25.05.2018 | Machine Engineering

Less is more? Gene switch for healthy aging found

25.05.2018 | Life Sciences

VideoLinks
Science & Research
Overview of more VideoLinks >>>