Alternative investment: reducing food losses


Klaas Smits of Robeco believes reducing food losses will play a key role in the efforts to feed the world's growing population

How much money do you waste on food? We’ll come back to that later. But the large amount of food loss and waste – the produce that is grown but which never makes it onto the plate – is an increasingly critical issue, given that food demand is rising much more quickly than the rate of supply.

Food demand is expected to go up by at least 70% over the next 40 years. That’s due to rapid population growth – the world population will expand by 2.4 billion by 2050 – rising per-capita incomes, changes in dietary preferences towards meat and increased usage for biofuel. These demand drivers are not going to disappear.

The supply side, meanwhile, is struggling to keep up. The improvements from two of the main hopes for higher production – the expansion of arable land and higher yields – have lagged the acceleration in demand for more than a decade. The food and agriculture (F&A) sector faces a serious challenge in meeting this growing food demand.

Can we feed the world’s growing population?
Understandably, the focus is on boosting food-production volumes. Improving farm inputs (such as seeds, fertilizers and crop protection), sustainable intensification and more trade (to bridge the gap between geographically dispersed production and demand) are some of the ways that higher demand will be met. It will require innovation and investment, but it is achievable.

Stopping losses is part of the solution
However, cranking up food volumes isn’t the only answer. In fact, there’s scope for improvement in each link of the food chain. But reducing losses and waste is a crucial area if the 2050 food-production requirements are to be achieved.

Let’s be clear. This is not a peripheral issue. According to the Food and Agriculture Organisation, around a third of the edible food produced for human consumption is lost, wasted or discarded due to inefficiencies in the food chain. That adds up to around 1.3 billion tons each year. Per-capita food loss in Europe and North America weighs in at a hefty 280-300 kg per annum.

What sort of inefficiencies are we talking about? In industrialised countries, the problem area is the retail and consumer phase. That’s where more than 40% of food waste occurs. Issues include retailers rejecting food that doesn’t look perfect – the bent-carrot syndrome – and consumers binning food, most of it still fit for human consumption, due to bad planning when shopping and expiring “use-by” dates.

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