Borderless Executive Live: The Podcast

Food Waste: Enough to Feed 2 Billion Every Day, in conversation with Juan Aguiriano of Kerry Group

November 02, 2021 Season 2 Episode 5
Borderless Executive Live: The Podcast
Food Waste: Enough to Feed 2 Billion Every Day, in conversation with Juan Aguiriano of Kerry Group
Show Notes Transcript

In this second conversation with Juan Aguiriano of Kerry Group, Juan discusses food waste and how the food industry can tackle this issue, which creates enough food it could feed 2 billion people every day.

Andrew Kris:

Hello and welcome to borderless executive Live. Today we're going to be talking about the food industry and in particular, how food waste is being handled. We have joining us today for our second session this series, Juan Aguiriano. Juan is going to be talking to us today specifically about a subject that is close to his heart, and close to ours. And that is the subject of food waste. Juan, if I may address this directly to you, my understanding is that there's enough food waste daily to feed about 2 billion people, Is that an accurate assessment?

Juan Aguiriano:

Yes, Andrew. That's correct. As a society, if we could reverse the trend of food waste and totally eliminate food waste, there would be more than enough food to feed an extra 2 billion people every day. It's a staggering number by any estimate. Multiple estimates say around 30% of food is lost or wasted every day, that means it's not consumed. And reducing food waste is going to become critical as the population estimates put us to grow from 7 to 9 billion, or 7 to 10 billion people in the coming years.

Andrew Kris:

So we have enough food actually to feed that growing population?

Juan Aguiriano:

Theoretically, yes. And if you also imagine all the inputs, the resources which re associated to food waste, he land used, the fertilizers, he water, the energy, the work f the farmers, and the economic oss associated with food loss nd waste is huge. It's $936 illion a year. That is the cost o the economy globally. A rillion. At the same time, the billion people compare very avorably to 700 million people hat suffer from ndernourishment or alnutrition. So the food vailable by reducing food aste, is three times the size f the population that is in eed of additional food. bviously, it's easily said, t's very complicated to solve b cause it happens in multiple p aces of the value chain. But i 's definitely a topic that is g owing in importance in the m nds of the consumers, and it's g owing in importance in the m nd of companies trying to s lve it and it's definitely rowing in the mind of the nvestors, because it is really n opportunity for a win-win-win cross the board. Better for eople, better for society, etter for the planet, better or the economy. Today, the good thing is that 78% of consumers associate food waste with sustainability. This is based on research that K rry commissioned, it's not pri ate research, so anybody int rested can go on ker ygroup.com and look at that. And so consumers are starting to buy products that are marketed as more sustainable product, a c rcular product, that reduces ood waste. And they are willing o pay extra. 44% are willing to ay extra for food & beverage roducts devoted to solving food aste. So this is excellent new because it's not anymore a nice to have. It's obviously a must have for the planet, but it's a must have also for cons mers. We can really say look sustainability is a cost for s.

Andrew Kris:

You did mention in our earlier conversations, there are a couple of key categories, which are the biggest culprits, if I can put it like that in terms of ways. One you were saying was the bakery industry. And the second you said was the meat industry. Bakery is pretty high volume stuff, right? We eat bread and everything every day Whereas meat has the highes value, and how do you see thes questions being addressed, fro a category perspective

Juan Aguiriano:

Yeah, let me talk through the categories, maybe a few comments first, for context. So, where does food aste come from in the supply ch in? And we can then talk about the two categories. So food lo ses happen mostly at the product on, post harvest and proces ing stages in the food supply ch in, and mostly in emerging mark ts. Food waste is actually rel ted to retail and cons mer behaviours, and it happens m stly in developed markets The consumption stag is responsible for more than 40 of the food waste globally, but the statistics are very differ nt. In emerging markets, the consumer food waste is q ite small, and the food los is happening in the value ch in. And in developed markets, ike US or Australia who are to of the charts, the total food w ste happens mostly at cons mer level. And it's sometimes u to 50% of total food that is wa ted or lost every

Andrew Kris:

And getting produce in from the field used to be the biggest area, until plastics and packaging became a little bit let's say better adapted to handle inc

Juan Aguiriano:

That's right, the revolutions were the packaging, and the other one was the cold chain. The behaviour right now are still driving mos of the waste at consumer level There is waste and los happening in the supply chain and at manufacturing level, an the players there are working lot on that. There's also foo waste and loss happening at th retail level, at QSRs, i restaurants. And in some case you know COVID has exacerbate some of these issues, but at th same time raised the awarenes and consciousness about solvin them. So in summary, i developed markets, th opportunities are at consume level, so an American consume wastes 10 times more foo annually than the same consume in Southeast Asia. There's massive difference there. Bu studies show that half of tha food waste could be prevented o reduced by extra shelf lif days. That's the first point and where we can start lookin at solutions. In emergin markets, most food loss occur early in the supply chain before food reaches th retailer. But again, man sources of this food loss can b directly addressed b preservation solutions as well So let's go back to the categories and your question. So bakery is the highest processed food waste category in volume, and meat is the highest food waste category in value and also in environmental footprint. So some statistics that are interesting; one quarter of consumers do not finish their bread before it goes off, which translates to approximately 32 million loaves of bread going to waste globally each day. And there are technologies to extend shelf life with clean label solutions. We're not talking chemicals here - nasty chemicals, but just natural, clean based solutions which can extend the shelf life of bread by 75%. But it's not yet universally used.

Andrew Kris:

And we're talking about stuff that is economically viable, of course, right?

Juan Aguiriano:

Totally economically viable. But needs to be involved and integrated in the formulation of broad based bakery products. And in doing that, if you add extra shelf life, you minimize food waste. And if you calculate the environmental costs of wasting one loaf of bread, it's half a kilo of co2 per loaf of bread, and it's 568 litres of water. So you multiply the 32 million loaves of bread every day by this footprint, and we're talking about not only reducing economic costs, but having a massive environmental impact, a positive one in doing that. Now in meat, it gets even more interesting. Because meat is already the number one consumer concern for food safety, and now consumers are realizing the impact of food waste in meat. So 20% of meat goes to waste every day. And it's by far the most carbon intensive category. Ev ry kilo of meat, let's talk ab ut beef, produces end to end 60 kilos of co2, so if you can sa e one kilo of meat loss, you sa e 60 kilos of co2 and 14,000 li res of water.

Andrew Kris:

That's an incredible number, Juan.

Juan Aguiriano:

So that 20% of meat waste could theoretically feed 80 million people. So Andrew, I think the mathematics speak by themselves. It's more a question about the solutions.

Andrew Kris:

Indeed, let's spend a minute or two on that too, then Juan?

Juan Aguiriano:

We talked about the best thing to do is principles of circular economy. It's reduce, reuse, right? Let's talk about reduce, first. I think the key here is preservation solutions that need to do four things. They need to make sure the food is safe to consume, because food safety is the first thing. The second criteria it needs to meet, is maximize the shelf life, but do that in a way that is acceptable to consumers and doesn't create another problem. So there are a number of historically chemical type preservatives, that create health issues, which are now being phased out. And we don't need to go through the list, It's a long list of things which are being replaced and reformulated, by so called clean label solutions. What are clean label solutions? They are solutions which are based on more natural ingredients, fermentation, babylights, enzymes, organic acids, etc, etc. So there's a broad range of products that can replace chemical preservatives, and the idea is to maximize the food safety and maximize the shelf life, at the same time, you are trying to minimize the packaging. It's a holistic situation here. Obviously, if you shrink wrap every food in plastic, yes, it lasts longer, but you created another side effect, which is too much plastic.

Andrew Kris:

Which is recycling the plastic of course, or

Juan Aguiriano:

Yes, so can you recycle the plastic? Can we use reusing plastic? the plastic? Or can you minimize the plastic? The outcome of all of that is to minimize food waste. The big impact that you're trying to drive is food waste minimization. So that's where the industry is working in optimizing that equation, the maximization of safety and shelf life, minimizing plastic and food waste. It's not an easy equation, but there is a lot of progress being made in that area. And you can see more and more brands launching products that have extra shelf life, less packaging, and more food waste minimizing claims, and these products are growing faster than the rest of the industry.

Andrew Kris:

Of course, you do see also some efforts that are too narrow in their concept. Where, for example, minimizing use of plastics just leads to more food waste. Well-meaning solutions are actually having a reverse effect.

Juan Aguiriano:

That's a great comment, Andrew. And that's why this needs to be looked holistically, at the total sustainability impact rather than looking at just one of the inputs, because what looks like a good solution, might be suboptimal in the bigger context.

Andrew Kris:

Absolutely.

Juan Aguiriano:

So that's why at the beginning I talked about circular economy, you need to look at this end to end. Look at the total lifecycle of the product, what are you really reducing, and where do you reduce the most? And then you also need to look at the different alternatives in the packaging, because different substrates have a different type of lifecycle assessment. I'll just talk maybe on the second part. We talked about reducing and enhancing shelf life, that is probably one of the best solutions. The other one is reusing. If you can't reduce the waste, can you reuse it? And mostly I'll talk about industrial options, or manufacturing options. If you, for instance, take the beer industry. It's a very interesting industry, it has a relatively large footprint, because it generates a lot of spent grain. So when you produce beer, you have beautiful liquid with a beautiful flavour, but the by-product of that is spent grain. The cereals that you use to create the beer, right?

Andrew Kris:

Yes.

Juan Aguiriano:

So the industry is taking a very interesting approach of, can we repurpose the spent grain into interesting, useful ingredients that can be used to create something else? And so instead of feeding animals or landfilling that, can you repurpose the spent grain for human consumption? And you can. So a number of companies are looking at that, very large beer producers are now creating ingredient solutions out of that, to then do plant based protein beverages, for instance, working in partnerships. So you close the loop. Instead of cultivating cereals, and creating plant protein from the cereals you cultivate, you're also using cereals that have been first processed into beer, and out of that, then you create a plant protein beverage. Very interesting reuse, you will agree with me, of a waste stream, which is very significant. And so again, that's a model where you use the principles of circular economy, you reduce food waste and you create societal value, consumer value, because these beverages are full of proteins and nutrients, etc. And you create economic value for the company that creates that business model.

Andrew Kris:

Indeed, I think your company Kerry has written up quite a bit on this and is making a lot of information publicly available. Kerry Institute, is that correct term for it?

Juan Aguiriano:

Yes, we have he Kerry health and nutrition nstitute where we publish a lot of scientific researc . It's an open innovat on platform where we collabo ate with universities, the aca emia world. We publish a n mber of papers on the science of nutrition in general, su tainable nutrition, and we have published a number of papers o food waste, if people want to learn more about that.

Andrew Kris:

Everybody who is listening to this discussion can go and look up the material t ere?

Juan Aguiriano:

It's an open platform available for everybody. Also, we don't only publish white papers, we also have a number of webinars that happen every year. It's called the Kerry health and nutrition Institute.

Andrew Kris:

Now let's suggest that people with further interest in this topic can certainly go look some more stuff up there. We have another session coming up though in the next week or two Juan, as well. Next time, we're going to cover this transition that's taking place, in how people perceive food, and the way the industry perceives food. It's going from food to nutrition, and then ultimately to the impact on health. We're going to take a look at that particular chain in our next discussion, and how we go about increasing human health as a consequence of the food intake and achieving all of these sustainability issues. That's our next session Juan, I'm hoping you're going to continue to accept my invitations. It's always a pleasure to have your knowledge and experience to share with all of our listeners and viewers. Thank you so much for joining me again today.

Juan Aguiriano:

The pleasure is mine, this was fun. Thank you very much Andrew, I look forward to our next session.

Andrew Kris:

Me too. Thank you Juan, that's really super.