Tue, 24 Jul 2018
In 2011, when we celebrated the world population reached seven billion marks, a gathering of top scientists dire warnings on the future of what food we eat at the annual conference of the American Association for the Advancement of Science. The gist of it suggested one to seek for a remote cave and start stocking it with frozen – dried foods, sacks of beans, and a trunk full of survival tomes.
“By 2050, we will not have a planet left that is recognizable ”- a population predicted to hit 9 billion by 2050 will see more competition for increasingly scarce resources, necessitating the production of “as much food in the next 40 years as in the last 8,000 years … More people, more money, more consumption — but the same planet”, said Jason Clay, an eminent scholar and the vice president of World Wildlife Fund.
Even though there has been a persistent concern that human population growth would not be met by sufficient increases in agricultural production. Yet the opposite has been true. The supply of food has increased dramatically, fuelled by increasingly capital-intensive agriculture, continuing the application of biological/genetic science to food production, greater ability to save crops from pests, and greater ability to preserve perishable products during transport. However, the question arises as to whether this process of improvement can continue to meet the needs of a growing and more affluent global population.
The changing trends such as an increase in consumers who are health conscious than ever before, especially in North America and Europe are worried about the content of their food, its origin, freshness, and safety. The food supply chain should reveal the macro-food trends and thus indicate developments for the global food system in the future.
The food-supply chain and macro-food trends
The food supply chain shows the chain of food process from the farmers to the consumers. It comprises of the producers, primary and value-added processors, retailers and distributors, consumers, and governments-NGOs-regulators.
Roles of stakeholders in the food supply chain
Regulators: Public health and safety • Public policy Security (e.g., resource, land and food availability and allocation)
Producers: Research and development • Farming • Ranching • Trading
Processors: Harvesting • Butchering • Processing Manufacturing • Marketing
Distributors: Distributing • Retailing
Consumers: Shopping • Consuming
Macro – food trends
– An increase in consumers who are health conscious
– Impact of increasing world middle class
– Price volatility and mismatch of demand and supply
– Lack of land utilisation
-Food wastage and growing food insecurity
Key issues for the stakeholders
Today, more than ever before, consumers are thinking about food – from where its produced, organic or not and what’s in it, to where and when they eat it. They are also increasingly prone to anxiety about food safety. That’s not surprising given that, on average, over 300 foods recalls are reported every year, which result in more than 75 million food-borne illnesses, 325,000 hospitalizations, and 5,000 deaths. Among food industry executives, product quality failure is considered to be one of the biggest risks.
Throughout the world, the majority of farms are small, privately owned and family enterprises. This hinders efficiency from agricultural technology transformation to farmer’s management capabilities (e.g., brand and risk management, skill gaps)
The volatility of both input costs as well as the selling prices along with the uncertainty of weather and yields has become difficult to manage in farming due to long production cycles and the inability to respond to market movements. Thus they have to consider price, exchange rate, and interest rate movements before planting.
As the global population continues to expand, food processors will be challenged to continue to improve productivity. To date, the food supply chain has shown itself to be remarkably adaptive to evolving consumer demands. However, success in the future will require both adapting to changing demographics and consumer preferences as well as managing in an increasingly global and complex business environment.
Remarks on the global food system
According to the world economic forum revealed $14 billion in investments in 1,000 food systems-focused start-ups since 2010, while healthcare attracted $145 billion in investment in 18,000 start-ups during the same time period. The World Economic Forum research proposes the ‘Transformative Twelve’ could deliver significant impacts to food systems by 2030. ‘The innovation with a purpose’ work stream of them, which focuses on how technology and innovation can be leveraged to address challenges in food systems.
Changing the shape of Demand
Promoting value-chain linkages
– Generate up to $200 billion of income for farmers
-Reduce GHG emissions by up to 100 megatons of CO2 eq.
-Reduce freshwater withdrawals by up to 100 billion cubic metres
– Generate up to $70 billion of income for farmers
-Increase production by up to 150 million tonnes
-Reduce food loss by up to 35 million tonnes
-Reduce food loss by up to 30 million tonnes
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