Investigation of the determinants of farm-retail price spreads

Practice area: Public Policy
Client: Department for the Environment and Rural Affairs
Published: February, 2004
Keywords: modelling quantitative analysis

London Economics was commissioned by the Department for Environment, Food and Rural Affairs (Defra) to undertake an econometric analysis of the factors that have affected the spreads between farm gate prices and retail prices. According to the terms of reference of the project, the study was to focus on developments in the United Kingdom and a number of other EU Member States and cover a range of agricultural products. Moreover, particular attention was to be paid to the buying power of food retailers as stronger buying power is often cited as one of the reasons explaining weak farm gate prices.