Coles says NO to pigs

The news that Coles Supermarkets will only sell fresh pork from sow stall-free production in its meat department in the latest step in a well-established “ethical foods” trend in a bid to improve animal welfare and satisfy consumers concerns about them. Coles, and its pork producers, are phasing out fresh pork from piggeries that use confinement stalls by 2014. The Tasmanian government, other state legislators and New Zealand are heading down the same path.

The developments come at a time when the economics for the pig producer are fairly challenging. Less than a third of the meat from a pig is sold as fresh pork, with the remainder going into what is called “manufactured meat” – ham, bacon and other products – which compete with a growing volume of imports.

This development regarding fresh pork however should not surprise anyone. It is the latest action in a strong trend towards greater support by food producers and consumers of ethical standards in food production. “Ethical production” of foods covers a wide variety of attributes which include fair-trade, free-range, organic, rainforest alliance, a carbon footprint in future, and even goes extends to the use of recycled or bio-materials in packaging.

Australia is not acting alone in relation to the use of sow stalls. Denmark – a major source of imported smallgoods - has outlawed stalls from 2014, as part of a push across the European Union. The pressure from animal welfare and consumer groups has also gained a high profile in other major exporters of processed pork to this market - Canada and the US.

There is no doubting the consumer demand for ethical foods and their willingness to pay the difference for them. These trends have continued despite the effects of the economic downturn. Our own analysis suggests that consumer demand is well ahead of supply which is constrained by the time it takes growers to adjust their farming methods.

By far the greatest impact of this ethical foods trend has been around animal welfare issues. The egg category has seen strong gains in shares won by free-range and barn laid eggs. There is considerable brawling within that industry about the definition of free-range, however the ultimate arbiter of what will prevail will be the consumer, and whether they believe the message on the label. The free range share of Lilydale-branded poultry products has also been impressive within the meat category despite the price differentials. Pork will follow the same path as consumers respond to market offers like Coles.

Crucial to maintaining that consumer support, as demand expands, are production systems that are backed with credible, uniform standards that consumers can readily recognise, understand and trust. The risks of “ethical washing” are high which may serve to weaken that trust.

The news of this move has been accompanied by protests that the same restrictions should be placed on imported products. As noted the market is already moving in this direction both domestically and internationally. The signs are there and forward looking producers have read them. It’s what the consumer wants. It was the consumer that led Coles to this decision for their fresh pork offer and it will ultimately be the consumer that decides whether or not they want their ham and bacon products from pigs that are farmed in the same way.