Are we heading for dietary meltdown? Is our taste for low-cost, high-convenience food a recipe for disaster? Or is there more to contemporary food than additives and junk? Michael McCarthy, Specialist Writer of the Year, introduces a major investigative

The next time you tuck into your salmon sushi, drizzle first-cold-pressing extra virgin olive oil over your carpaccio of beef, even slap butter on a nice slice of toast, reflect: the cost of a square meal is not what it used to be.

Food has always had its price, but for more than 40 years that price has been going up, when, from looking in shop windows, you may have understandably thought that it was falling. The true cost of food has now reached a point a growing number of people believe is far  too high, and bringing it down will be one of the great challenges of  the 21st century.

That cost is not in immediate cash. There is no doubt that a chicken, say, or a bunch of grapes, are now far cheaper to buy in relative terms - at least in the rich West - than they were in 1960. The cost is in the collateral damage of the very methods of food production that have made the grapes and the chicken cheap: in the pollution of water, the enervation of soil, the destruction of wildlife, the harm to animal welfare and the threat to human health caused by modern industrial agriculture.

First mechanisation, then mass use of chemical fertilisers and pesticides, then monocultures, then battery rearing of livestock, and now genetic engineering ? the onward march of intensive farming has seemed unstoppable in the last half-century, as the yields of produces have soared. But the damage it has caused has been colossal.

Just take Britain. As a direct result of the way we have produced our food in the last four decades, many of our best-loved farmland birds, such as the skylark, the grey partridge, the lapwing and the corn bunting have vanished from huge stretches of countryside, as have even more wild flowers and insects. Thousands of miles of hedgerows, thousands of ponds, have disappeared from the landscape. The faecal filth of salmon farming has driven wild salmon from many of the sea lochs and rivers of Scotland. Natural soil  fertility is dropping in many areas because of continuous industrial fertiliser and pesticide use, while the growth of algae is increasing in lakes because of fertiliser run-off.

Salmonella is frequently found  in battery chickens, while BSE (Bovine Spongiform Encephalopathy), which devastated cattle and is now doing the same to  some unfortunate humans, may have been caused, the latest theory holds, by feeding to young calves industrial cattle food containing the remains of sheep.

Put it all together and it looks like a battlefield, but we still tend not to make the connection at the dinner table. That is mainly because the costs of all this damage are what economists call "externalities": they are outside the main transaction of producing and selling a field of wheat, say, and are borne  by neither producers nor consumers. To many of us they may  not even seem financial at all: the fact that the way wheat is now  produced means that skylarks  have vanished from the fields may seem merely aesthetic - a terrible shame - but nothing to do with money. And anyway we, as bread eaters, certainly aren't paying for it - are we?

But these costs to society can actually be quantified, and when added up, they can come to staggering sums. A remarkable exercise in doing this was carried out a year ago by one of the world's leading thinkers on the future of agriculture, Professor Jules Pretty, director of the Centre for Environment and Society at the University of Essex.

Professor Pretty and a group  of colleagues calculated the total "external" costs of British agriculture, the costs of repairing the damage it causes for 1996, and came up with a figure of £2,343m - equivalent to £208 for every hectare of arable land and permanent pasture, which was almost as much again as the total government and EU spend on British farming. It was a conservative estimate, according to Professor Pretty.

The costs included: £120m for removal of pesticides; £16m for removal of nitrates; £55m for removal of phosphates and soil, and £23m for removal of the bug cryptosporidium from drinking water by water companies; £125m for damage to wildlife, habitats, hedgerows and drystone walls; £1,113m from emissions of gases likely to contribute to climate change; £106m from soil erosion and organic carbon losses; £169m from food poisoning; and £607m  from BSE.

Professor Pretty draws a simple but memorable conclusion from all this: we are paying for our supposedly cheap food three times. Once, we pay for it over the counter; twice, through our taxes that provide  the enormous subsidies propping  up modern intensive farming  (£3bn annually); and thrice, to clean up the mess that modern farming leaves behind. You might not think that you are paying for that, but  the cost of getting agricultural chemical residues out of your drinking water always ends up on your water bill.

Can the true cost of food be brought down? Can the real price of cheap food be lowered? This is one of the most pressing challenges of the coming years, especially in the developing world, where intensive farming, chemical and genetic, is widely seen as the paradigm, as the only way to feed the vast and growing numbers going hungry - about 800 million at the moment, according to United Nations figures. But a country that relies indefinitely on high chemical inputs to grow its food is mortgaging the fertility of its soil, and one that relies on genetically modified crops is mortgaging the freedom of its farmers, who will be at the mercy of the multinational company that supplies both the seeds and the powerful herbicides the plants have been engineered to tolerate. (A firm such as Monsanto has consciously tried to reinforce the intensive-farming development paradigm, giving itself a logo of an ear of corn, and a motto of "Food, Health, Hope", when a truer reflection of the company's aims would be "Bigger Bucks From Deadlier Weedkillers".)

Breaking away from industrial agriculture as the solution to hunger may be very hard in the developing nations. Yet in countries such as Britain, where the immediate urgency to supply food is not so great, and the costs and the damage of intensive methods have been clearly seen, it may be more feasible. And there will never be a better chance than now, when in the wake of the foot-and-mouth crisis, the Government has ordered a root-and-branch inquiry into the future of British farming and food.

The inquiry, chaired by Sir Don Curry, a Northumberland farmer who formerly led the Meat and Livestock Commission, will "advise the Government on how we can create a sustainable, competitive and diverse farming and food sector, which contributes to a thriving and sustainable rural economy, and advances environmental, economic, health and animal welfare goals."

Industrial agriculture that ain't. But what is now to take its place? Organic farming? That would be a very big jump in thinking and in practices for many farmers, and  the price premium would put the produce out of the reach of many poorer consumers.  

Jules Pretty offers an answer, in a paper written for the Fabian Society and put up on its website a fortnight ago ("New Farming for Britain ? Towards a National Plan  for Reconstruction"). The Government, he suggests, should develop a new, official "Greener Food Standard", which "would  push the market towards more sustainable environmental practices than the current norm, while not requiring the full commitment to organic production."

Such a standard would comprise agreed practices for different  kinds of farming, covering agrochemical use, soil health, land management, water and energy use, food safety, and animal health. It could go a long way, he says, to shifting both farmers and consumers towards a more sustainable system of agriculture.

Heaven knows we need it. The "externalities" of intensive farming are attracting more attention than ever, and a book such as John Humphrys' recent The Great Food Gamble makes the connection between what is sitting on your plate, and what is going wrong in the fields, or indeed, beneath the salmon-cage in the sea loch, in the most  vivid way. Your salmon or your beef or your slice of toast might seem a lot cheaper than they were 40 years ago, but their true cost has never been higher.

Professor Jules Pretty's paper can be read at www.fabian-society.org.uk