By the end of the century, we will be eating industrial food made from recycled urban waste - and it may even be better for us, Cribb said afterwards. ''It's happening already. You don't know what's in a chicken nugget. We will eat synthetic meat with the same enthusiasm that we wear synthetic clothes.'' Supermarket discounting was ''a one-way street [that] will destroy most forms of agriculture over the next 20 or 30 years'', he said. There are 1.8 billion farmers in the world, but Cribb predicts more than a billion of them will be thrown out of work as food supply is increasingly concentrated. About a quarter of the world's food is traded internationally and, citing Rabobank analysis, Cribb said half that trade was now controlled by two dozen companies - the big soft commodity traders such as Glencore-Viterra, major food processors such as Nestle, and the massive global supermarket chains Carrefours, Walmart, Aldi, Sainsburys and their Chinese peers such as the Bailian Group. Tight specifications result in a lot of rejected product, accelerating food waste, while prices are driven down because while most food is not traded internationally, the world market determines local prices. If it is cheaper, supermarkets will favour imported over local. The result is longer and longer supply chains that are heavily dependent on fossil fuels for trucking and shipping - and are increasingly vulnerable as oil prices rise inexorably and the peak oil debate intensifies.

Australia's supermarket wars are part of an international trend. Coles' launch on Australia Day 2011 of milk at $1 a litre would inevitably lead to higher milk imports from New Zealand, which can produce it cheaper because of higher rainfall. When Cribb began writing about agriculture in the early 1970s, there were 20,000 dairy farmers in Australia. Now there are fewer than 3200 ''and they are leaving at a rate of two or three a week''. Cribb described as ''disingenuous'' Coles' argument that selling milk at $1 a litre does not lower farm gate prices, because it is cross-subsidised by other, higher-priced items. Within five years, he said, a new generation of Coles accountants will question why profit margins should be lower on milk than on other products and $1 a litre will become the true price of milk. While a Senate inquiry last year was inconclusive, there is growing evidence that farm gate prices are indeed falling, despite the supermarkets' protestations. Dairy Australia figures released in February showed wholesale milk prices - paid by the big retailers or distributors, and shared between the dairy farmers and the milk processors - fell 1.4 per cent in 2011, as a result of retail discounting. Only last week, the world's largest dairy exporter, New Zealand's Fonterra Co-operative Group, reported falling sales and earnings in Australia, citing the ''challenging retail environment and an ongoing pricing battle that has resulted in pressure on major suppliers' margins''. The hunt for alternatives is on. One avenue is the growers' market, premised on local supply direct to the consumer, cutting out the middleman and ensuring a better return for the farmer.

The federal Agriculture Department's Food Statistics 2011 report, released on Monday, included a survey of 72 farmers' market managers, finding more than two-thirds reported rising stallholder and customer numbers. The average annual sales reported by market managers was $1.4 million, from a typical 850 customers, which sounds small. But the number of farmers' markets nationally more than doubled from 2004 to 2011, from 70 to 152. The department estimates they now account for 7 per cent of Australia's fresh food market. Despite the tough retail environment, 97 per cent of the survey's respondents believed their farmers' market was sustainable in the long run. Jane Adams, spokeswoman for the Australian Farmers' Markets Association, helped found the largely volunteer movement and has watched the ''paddock to plate'' model take off in the past 10 years. Addressing concerns about the authenticity of some markets - which rely on resellers rather than growers - Adams says the association's website lists only markets that engage in best practice and stick to the values consumers want: ''Fresh produce, just-picked, seasonal, sourced closer to home, bought from the person who grew it, caught it, baked it or brewed it''. With $4 million in state government funding, the Victorian Farmers' Markets Association has begun an accreditation scheme to ensure market authenticity and Adams hopes other states will follow suit.

The growers' markets also have spinoffs. A natural extension of the growers' market, Adams says, is to establish local-produce-only retail stores, such as Totally Local in Orange, which sources everything from the central west of NSW. Growers such as Moorlands Lamb, near Goulburn, use markets to build clientele face-to-face, who then order produce online and have it home-delivered. For highly perishable products such as fruit and vegetables, an alternative is the regional food hub, a community-supported agriculture (CSA) organisation for people who join up to get seasonal produce. Former Victorian dairy farmer Robert Pekin, who was pushed off his land by drought and the banks in 1997, founded Food Connect in 2007 as a community-interest company - a hybrid between a for-profit and non-profit organisation - and has watched it take off. Founded in Brisbane with capital of about $500,000, and now with 85 employees across the country, Food Connect sources seasonal fruit and veg from local growers - originally, those within a five-hour drive of Brisbane, but Pekin hopes fresh vegetables and leafy greens will be grown less than an hour away, dairy might be sourced within a two-hour radius, while grains might be available only five hours away. Produce is delivered each week to its ''Homestead'' by the farmers or small freight companies. It is packed in boxes and delivered to a network of ''City Cousins'' - families, schools or community centres that act as dropoff and pick-up points - for subscribers to collect.

''It's like an invisible facilitator, moving food through a hub to retailers, cafes, restaurants and ultimately direct to consumers,'' Pekin says. ''We sell 80 per cent organic but we're on a par with retail conventional prices at Coles and Woolies. We've been like that for years. We're all about affordability and equity back to the farmer. We're paying our farmers double what they would normally get, because we've cut out all that profit from the middle. ''But the more box systems, the more CSAs, the more farmers markets, that are all operating from an equitable point of view, then the more Coles and Woolworths are threatened. ''They're monitoring us. We see what we've said maybe one or two years ago suddenly pop up in terms of their marketing, in their messaging. ''In some of their plans, we've had a few people come to us with some of their strategic plans, for the next 10 years, what Woolies in particular are wanting to do, which is to go towards a more regional model.

''They want to get supply from farmers locally and they're starting to look at how they can own local shops and brand them for Woolworths. So there's already moves afoot for them. ''They've got plenty of people thinking about this, saying, 'Your logistics system is absolutely fantastic, but it's predicated on cheap fuels. If that runs out you're in serious do-do, you have to change your system.' ''Their system has to become a bit more like an IGA, more smaller stores; because people aren't going to be able to drive out to these big Westfield shopping centres. They're going to have to come more to the original main street.'' Food Connect's model has been replicated 15 times around the country and has now led to Pekin forming the Australian Food Hubs Network, working with Melbourne University's Victorian Eco-Innovation Lab. They are also thinking beyond Food Connect, to set up an ''Eatbay'', with farmers selling online direct, either fixed price or bidded. Anything that can support small, local farmers.

''Coles want to go to 20 suppliers,'' says Pekin. ''They have at the moment around 500 suppliers, they want to go to 20. They're forcing farmers to buy out each other and basically become king of the heap. I know some of them and they are ruthless in purchasing land. It's just basically: 'how good a deal can we do with the banks to buy, say, corn farms right around Australia?' so you've got the whole corn market. ''That's that whole business-as-usual model, of just concentration, concentration, concentration.'' Paddy Manning chaired day one of the National Sustainable Food Summit this week.