Our global food system is faced with the challenge of producing about 70% more food to feed a global population that will cross 10 billion by 2050. With significant progress made in agricultural productivity over the past 50 years, Asia appears well placed to contribute to domestic food security and meet global efforts to achieve the Sustainable Development Goal (SDG) of Zero Hunger. However, agricultural growth rates have stalled in several countries due to factors including climate change and a lack of arable land.
On the 23rd of November 2018, Food Industry Asia (FIA) in collaboration with Cargill held the Re-imagining the Future of Food event to launch the Food 4.0: Innovations in Asia’s food systems report by the Economist Intelligence Unit (EIU), commissioned by Cargill. According to the EIU, these six mega-trends will present themselves in Asia’s food systems in the next 20 – 50 years:
- Greater urbanisation will occur at a faster pace in developing Asia
- Diets will become more energy-dense
- Rising obesity and persistent undernutrition will occur
- Research and Development (R&D) will be a key driver of agricultural development
- Greater interest in transparency and sustainability in food systems
- Politics will continue to play a role due to divergent political interests and resource scarcity
With the backdrop of these six mega-trends, the EIU identified technology and innovation as key to addressing several challenges in Asia’s food system, and suggests how policymakers and the private sector can best manage these trends. The full report can be downloaded here.
Following the launch of the report presented by Rashmi Dalai, the EIU’s Managing Editor, a panel session featuring the CEOs of some of the biggest food and beverage companies in Asia today discussed these trends and drivers, and the creative technologies and innovations in the food industry that can help secure the future of food.
Innovating for scale
With 75% of farmers in Asia Pacific being smallholders, Peter Van Deursen, CEO (Asia Pacific) of Cargill and a Board member of FIA shared that what innovation means to these small growers differs greatly from that of a farmer in North America or Europe. Innovation does not necessarily refer to drones, artificial intelligence and big data. For smallholder farmers in Asia, innovation is about getting the basics like irrigation, access to markets and finance right.
Ehab AbouOaf, Regional President (Asia-Australia, Middle East & Africa) of Mars Wrigley Confectionery and FIA President added that the innovation of approach and not just innovation of the technology is crucial. At Mars, the expansion of best practices is done through training, and those trained will then share this knowledge with others.
Adopting a multi-stakeholder approach is a way that The Coca-Cola Company practices innovation in approach, according to Iain Mclaughlin, the company’s President for their ASEAN Business Unit. Iain shared the example of Project Unnati, where the company helped farmers double the mango yields per hectare of cultivation by working with Jain Irrigation and the Indian government. This enabled them to provide farmers with the right technology at a much greater scale.
Changing consumer habits
Asia’s growing demand for protein can lead to several challenges for food producers. Eastern culture views protein differently from the West, said Matthieu Vermersch, Founder and Managing Partner of VisVires New Protein. He advised that if the industry is to meet the needs of the Asian consumer, it will need to push innovative products that are low in price point and appeal to the mass market.
Rashmi highlighted that aside from technological innovations, people’s diets must innovate as well. In Asia, diets are increasingly flexible, and consumers are willing to try new products. For an innovative food sector, the demand from consumers has to be present to sustain its growth.
The growing double burden of malnutrition and obesity continue to plague the region, but Iain shared that small steps like reformulation and increasing transparency as an industry on food labels can ease the worries of consumers. Government efforts like the Healthier Choice Label from Singapore’s Health Promotion Board have encouraged food producers to join the scheme and guided consumers to make healthier purchase decisions. The business impact of increasing transparency has been positive for the company, and more than 60% of their products in Singapore have the healthier choice symbol, reflecting the demand for healthier products from consumers.
The idea of transparency led the panellists onto the topic of food safety, an increasingly critical challenge in the region and a focus point for food companies. To achieve full traceability and transparency of supply chain, technology will be key. Ehab shared that Mars has approached food safety as a pre-competitive space that the company operates in and encourages companies in the industry to share knowledge and establish global food safety standards.
Technology can increase traceability and transparency of one’s source of food, which can create trust between consumers and companies. In 2016, Cargill opened its own licensed buying company in Ghana that allowed it to directly source cocoa farmers and barcode bags for traceability. On product packaging, The Coca-Cola Company implemented QR codes to provide ingredient definitions, GMO disclosures, and contact information. These technologies are helping large multi-national organisations to be more transparent and provide consumers with greater levels of traceability for their products.
The future of food and innovation
The panellists agreed that innovation cannot and should not be dictated, and creating an environment for organic growth of innovation is optimal. The eco-system that drives innovation should bring government stakeholders, industry partners and research leaders together to nurture and accelerate the process towards a brighter future for the food industry.
Concluding, Cecilia Ma Zecha, Asia Pacific Bureau Chief for Clarity Media Group and moderator posed the question, “What needs the most attention in the food industry?”. The concluding statements were shared by the panellists:
- Ehab shared that the industry should be more intentional about uncommon collaborations, such as private-private, private-public with a longer-term outlook.
- Matthieu shared that Asian consumers and changing diets should be closely monitored and would be a great opportunity for producers.
- Rashmi reiterated that she would like to continue to raise awareness that both the food industry and consumers can impact the world’s food systems.
- Although not discussed in detail during the session, Iain highlighted the importance of the food industry’s commitment to the manufacturing of recyclable packaging.
- Peter concluded by highlighting the importance of having similar panel discussions and conversations about sustainable food practices and how the industry should take action now
Technology presents a great opportunity for the food industry, but collaboration should be key in harnessing the collective efforts of industry members to solve food challenges in the industry. At FIA, we aim to bring together industry leaders to champion initiatives that promote sustainable growth and support regional policies that deliver harmonised results.