Sector Report

Food & Agriculture

Nourishing Land and Lives

There is an urgent need to make our food system far more sustainable.

Growing population and associated food consumption is fuelling biodiversity loss on an unprecedented scale, with 40 percent of the world’s once-forested land now cleared for human agriculture and settlements.

Ecosystems on land and in the ocean are being devastated by plastic packaging – a large percentage of which comes from food and beverage products. Actors in the food value chain, from growers to retailers, are paying increasing attention to both food and plastic waste – exploring ways packaging can be reduced without compromising product shelf life or food safety.

“Demand for food poses one of the biggest dangers to our planet. It’s the leading cause of deforestation, destroying countless habitats and threatening wildlife to the point of extinction.”
Tanya Steele, WWF UK Chief Executive

Signals to Watch

Balancing Packaging and Food Waste

Plastic food packaging is increasingly in the media spotlight, with consumers demanding action from companies on single-use plastics. Food producers and manufacturers are feeling the pressure to reduce both plastic packaging, as well as food waste. Research shows that smart and sustainable packaging can help reduce food waste, and a growing number of companies are investing in new technology solutions.

“An issue of packaging is an issue of food waste, and an issue of food waste is an issue of hunger and food availability — we need to find and focus on the balance.”
Jackie Suggitt, Director of Business Initiatives, ReFED
  • The global cost of food waste is estimated to be almost $1 trillion a year, with up to 25 percent of residential waste arising from inadequate packaging.

  • While some believe single-use plastic packaging has led to an increase in the amount of food waste, many argue that without plastic packaging the cost of food waste could rise.

  • There are a growing number of companies investing in sustainable packaging. Kroger has partnered with Apeel Sciences that makes a protective film from agricultural by-products and waste, and Florida-based SaltWater Brewery is using a biodegradable and compostable six-pack ring design made from wheat and barley.

  • UK retailers, Tesco and Waitrose, have launched new sustainable packaging to extend the shelf life of avocados and Morrisons is due to trial a film packaging solution which can extend shelf life by up to two to four days.

  • Start-ups in the US tackling the challenge of food waste received over $125 million in venture capital and private equity investment in 2018.

Picking on the Kids

The rate of obesity in children and adolescents has risen tenfold globally in the past 40 years, with food marketing being one of the most recognised contributors. Children in developed countries continue to be brought up in an obesity-promoting environment, surrounded by inexpensive and persuasively marketed high-calorie food. Children are exposed to twice as many low-nutrient food as healthy food ads, with research demonstrating that such exposure has negative impacts on children’s diets.

  • WHO has found that existing policies and regulations aimed at food marketing to children in most countries are “markedly insufficient,” with children still exposed to harmful commercial messages promoting foods high in fats, salt and sugar.

  • Obesity experts are considering litigation against the food industry in the light of emerging research suggesting that a rise in junk food neuromarketing that could hijack a child’s brain.

  • Of the estimated £296.6 million spent on food marketing in the UK each year, only 5 percent is allocated to fruit and vegetables.

  • The Peas Please initiative is proposing a new Veg Ad Fund to ensure vegetables receive similar levels of marketing investment as branded chocolates, fast food outlets and soft-drinks. The campaign will launch in 2019 and has support from major supermarket chains.

  • McDonald’s recently announced intentions to comply with stricter nutritional guidelines and responsible marketing, leveraging innovative marketing to help serve more fruit, vegetables, whole grains, lean protein and water in Happy Meals.

Food producers and manufacturers are feeling the pressure to reduce both plastic packaging, as well as food waste.

Dietary Diversity

Biodiversity is essential to ensuring healthy ecosystems, food security and nutrition, but food systems are a key driver of biodiversity loss worldwide. Despite some 7,000 crops being edible, the majority of the world’s global energy intake comes from just three: rice, wheat and maize. The resulting monoculture, coupled with increased pressure on agricultural land for livestock farming, is fuelling biodiversity loss on an unprecedented scale.

  • Living Planet Report by WWF identified human consumption to be behind an extraordinary loss of vertebrate species.

  • Between 2010 and 2050 the environmental effects of the food system could increase by 50-90 percent, reaching beyond planetary boundaries if no action is taken.

  • Consumers are increasingly aware of the impact of diet on biodiversity. One in eight Britons is now vegetarian or vegan and a further 21 percent claim to be flexitarian.

  • India has long been a global leader, with approximately 20 percent of the population being vegetarian, but progress is also being made in China, where vegetarian restaurants are beginning to proliferate in major cities, and meat sales are beginning to decline.

  • Retailers are encouraging consumers to adopt more sustainable diet. Tesco is partnering with WWF to encourage shoppers to buy affordable sustainable food.

  • Walmart and Unilever are collaborating with local governments to halt loss of biodiversity in their sourcing regions.

Feed Behind Our Food

Animal feed is a vital, yet unseen, input to the food industry that has significant implications for environmental health and food security. Agriculture is responsible for 14.5 percent of all greenhouse gas emissions, with feed production accounting for 45 percent of this total. In many countries livestock production is accelerating deforestation, biodiversity loss and water scarcity.

  • While the use of most food waste in feed is illegal in the EU, it is promoted in other parts of the world. In Japan and South Korea around 40 percent of food waste is recycled as animal feed.

  • Pressure from advocacy groups and even pig farmers to relegalise heat-treated swill in the EU is increasing, with research suggesting that this would significantly reduce land consumption.

  • Companies such as Calysta, Protix, Ynsect and Evonik are investing millions in innovative traceable feed ingredients. This includes insect-based protein, oil from natural marine algae, feed additives like amino acids, and protein derived from methane-eating bacteria.

  • Pet food represents as much as 30 percent of all meat consumption in the US, and there is growing need for sustainable alternatives. Wild Earth is currently the biggest player, making dog and cat treats from fungus and lab-grown mouse meat.

Globally, poultry consumes the greatest amount of manufactured feed. Source: International Feed Industry Federation

What to Expect in 2019

Issues related to waste and packaging will continue to attract scrutiny in the coming years putting pressure on companies and other key stakeholders to look for systemic solutions. Poor industry standards regarding marketing of low nutrition, high calorie foods and beverages to children will also generate more intensive debates – with an increasing number of companies taking voluntary action to raise industry standards. Protecting biodiversity, wellness and plant-based diets will also be a larger focus for advocates, business and consumers.

What This Means for Business

  • Implement circular solutions

    Growers to retailers need to embrace circular thinking to address current systemic limitations. This approach looks beyond setting ambitious recycling targets for packaging and takes into consideration efforts to upcycle food waste into new products – where waste products from one part of the system become inputs to another.

  • Improve visibility of hidden issues

    The food security debate has largely focused on the farm sector and on trade, with other segments including agri-inputs, processing, logistics and wholesale relatively hidden. Within these areas, sustainability issues such as biodiversity loss, water scarcity and human rights breaches can often go unnoticed. With consumers demanding ethically sourced and high-quality products, food companies must tackle the complex challenge of supply chain visibility and should look to the ways that advanced technology, such as blockchain, can enable this.

  • Advocate for smart policy

    Food and beverage companies have an important role to play in working with policymakers to catalyse change. For example: advocating for stricter regulations regarding advertising to children; influencing the structure of deposit return schemes for plastic collection; and making sure new policies (such as the US Farm Bill) incorporate action regarding the pressing need to improve soil health.

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