The global food system transformation

The Future of Food: a new dawn

Our relationship with food is extremely personal. Our children need food to grow, we need food to sustain us and food is closely connected to our daily social interactions and family rituals. What we eat involves choices that are both highly individual and deeply ingrained in culture and tradition. “The family kitchen is at the centre of our house,” says Shay Eliaz, strategy principal at Monitor Deloitte in the United States. “My earliest, most intimate memories involve the aroma of my mother’s cooking.”

The Future of Food: A fundamental industry-wide transformation

But as personal and necessary as food may be, it is also intertwined with detrimental social, health and environmental impact. The fact is, the food industry faces a tremendous challenge right now: providing the growing global population with sufficient, healthy food while ensuring the long-term sustainability and liveability of the planet. 

Preparing to expand food supply by 50% in 2050

It’s true that our food supply chain is a highly efficient and productive system accounting for US$8 trillion business value. But consider that this model will need to feed a global population of about 10 billion people by 2050—that means expanding the food supply by a full 50%. Extrapolating that 50% from the existing food system is not a realistic option, according to a report from the EAT–Lancet Commission on healthy diets from sustainable food systems. That’s because the rising health and environmental implications and costs of the current supply chains—which do provide access to inexpensive food—are not being factored into the equation.

Since the launch of the EAT-Lancet report and in light of the COVID-19 crisis, a number of companies are starting to rethink and reshape their future by engaging in a more purpose-driven agenda. In this series, Deloitte explores the necessary food system transformation that needs to take place and looks at opportunities for companies to adapt to this future. This article is meant to be a foundation for further exploration, dialogue, and action. In addition, it is meant to deepen our collective understanding of what success looks like and what is required to achieve it. It is for organisations that not only want to change, but to thrive in this new world.

The case for change: 1 - Sustainability

Let’s take a closer look at the situation at hand. First, it is clear that today’s increased agricultural activity is a threat to environmental sustainability. Continuing with the current trajectory, the environmental impact from food production will increase from 50% in 2010 to 90% in 2050. Greenhouse gas emissions will increase from 80% in 2019 to 92% in 2050, crop land use up to 67%, freshwater use with 65%, and phosphorus and nitrogen applications with around 50%. If we continue with our food system as it is, we will surpass all possible planetary boundaries in 2050. [1]

The case for change: 2 - Health

Second, the EAT-Lancet report reveals that our food system is a key driver behind health problems. Unhealthy diets pose a greater risk to morbidity and mortality than unsafe sex and alcohol, drug, and tobacco use combined. The system is also highly unequal. Globally more than 820 million people remain undernourished, while it is projected that almost half the world’s population will be overweight or obese by 2030 [2] [3]. We are witnessing a steep increase in diet-related diseases such as type-2 diabetes and coronary heart disease [4]. This results not only in reduced quality of life for those affected, but also puts a large burden on economies due to rising healthcare costs and lost productivity.

The case for change: 3 - Consumer demand

Third, consumers are increasingly demanding sustainably sourced and healthy products. The COVID-19 pandemic has demonstrated and increased the urgency of taking care of your health and having a strong immune system has never been more critical. Consumers also now have a deeper understanding about the relationship between what we eat, how it has been produced, and our health and our environment—and are demanding that companies live up to their values. This can translate directly into profit opportunities: research shows that products which are marketed as sustainable, grow 5.6 times faster than those that are not. [5]

The case for change: 4 - Regulatory pressure

If companies will not act themselves, governments will likely act for them. In Europe, regulatory pressures are becoming more disruptive to the food sector, as countries seek to manage their nitrogen and other greenhouse gas commitments. The European Commission has recently announced its 2030 targets, which assume a 55% reduction of greenhouse gas emissions compared to 1990 levels. To meet these challenges, players in the current food system will need to collaborate, adapt, and scale mitigation approaches such as carbon trading, regenerative farming, and track & trace solutions.

The food industry is moving

Some food companies, including some of the world’s largest players, are beginning to make serious environmental sustainability and public health commitments. “A number of companies have crossed the river, and we see more companies redefining their strategy to future-proof themselves,” says Jagt. “However, the job is far from done. We have a long way to go to realise the food transformation that is needed.”

Substantiating the food system transformation

The Future of Food –new dawn series explores what food system transformation means for organisations and what they can do to realise it. Each article will focus on one of the four themes that we consider pivotal in the transformation:

• Personalised and healthy nutrition
• Responsible production
• Responsible waste management
• Ecosystem orchestration

Personalised and healthy nutrition holds tremendous opportunities to drive organisations to provide more transparency on production methods and to advance individual and public health outcomes. Responsible production and waste management practices are needed to meet consumer needs and dramatically reduce the environmental impact of food. No single organisation can deliver this transformation alone, so ecosystem orchestration and collaboration is required for success.

The north star: new opportunities and contributions to a better world

In each article, we will focus on the practices organisations can implement to help advance the food system transformation, as well as the associated market and profit opportunities. In the final chapter, we will look at how companies can define their “north star” and organise themselves to prepare for the future of food. “If they do so successfully,” says Eliaz, “They will not only discover new market and profit opportunities but contribute to a better world.”

Sources

1. ‘How COVID-19 is accelerating the food transformation’ - 2020 – Deloitte Blog
2. ‘The EAT-Lancet Commission Summary Report’ – 2019  - EAT-Lancet Commission
3. ‘Unravelling the Food-Health Nexus’ – 2017 – International Panel of Experts on Sustainable Food Systems
4. ‘The global nutrition transition: trends, disease burdens and policy interventions‘ - 2018 – School of Allied Health, Sydney
5. ‘Sustainable Market Share Index’ – 2019 – NYU Stern Center for Sustainable Business and IRI