Tackling food waste provides an enormous opportunity to reduce the environmental impact of food production. Moreover, food waste reduction has the potential to create business value. There is a surprisingly wide array of practices to reduce or ‘upcycle’ waste. It is key to understand which combination of practices will create the most impact and business value. A host of recent innovations can help bring clarity as well as solutions.
The immense need to tackle global food waste
More than one-third of global food production – around 1.3 billion tons of food – is lost or wasted annually. Unless we take urgent action, global waste will grow by 70 percent by 2050. Food waste is driving up costs for consumers and the food industry, and is putting a disproportionate burden on our already strained planet.
Minimising food waste could lead to substantial environmental and economic gains, as well as improved food security for the world’s poorest. This makes sense for all stakeholders in the food system and for humanity at large. It comes as no surprise that eliminating food waste is one of the pillars of the EAT-Lancet Commission. We urgently need to reduce the total amount of food wasted and find new ways to deal with the waste we have.
There are many roads leading to Rome, but we need to chart the shortest course
The best way to reduce waste is to prevent it. Approximately half of total food waste in the industrialised world occurs at the consumption stage. This suggests that a large impact can be made through initiatives targeted at consumers. Awareness campaigns can help consumers to reduce overbuying, preserve food longer, recycle food scraps and not waste perfectly edible food. Various supermarkets worldwide try to address this last issue by selling ‘ugly’ produce as a new food category. Another example are initiatives that connect consumers to share surplus food rather than letting it go to waste.
Significant gains can also be found in the often-long journey food makes before it ends up on consumers’ plates. This starts with understanding where waste is created throughout the supply chain: in sourcing, production, processing, storage, transportation and retail. To identify the most valuable combination of possible prevention initiatives, companies need to use these insights to weigh the benefits carefully against the cost of implementing them.
Half of total food waste in the industrialised world occurs at the consumption stage. Therefore, a large impact can be made through initiatives targeted at consumers.
Responsible waste management: opportunity areas
Click on the opportunity areas below to discover the various ways they may induce value creation.
Digital technology is key to identify and prevent possible waste
There are tremendous opportunities for deploying digital capabilities to prevent or reduce waste. Some prominent examples:
Various innovative companies use a combination of these technologies to provide insights into food freshness as it moves through the supply chain. A key example includes Walmart’s ‘Eden’ suite of digital products. This suite is able to track food from farm to store display, leveraging machine learning algorithms and sensors to provide retailers with more complete data about the freshness of food products. It can inform on decisions about where food should be routed, when it should be displayed, and the appropriate shelf-life of a product. Walmart aims to eliminate two billion dollars in waste over the next five years with this method.
Walmart aims to eliminate 2 billion dollars in waste over the next five years with their ‘Eden’ suite
Finding value in waste
In some cases, waste cannot be prevented. But even then, smart initiatives can help to reduce its environmental impact. Where oversupply of food occurs, retailers or food service companies can stimulate demand by using techniques to lower prices dynamically as expiration dates near.
Some companies are even exploring opportunities for creating value from waste. This approach, called ‘upcycling’, is an interesting development in the movement towards a circular economy. Instead of a liability, waste becomes an asset. Think if technologies that convert food and farm waste into renewable energy. We’ve also seen initiatives transforming carbohydrate-rich by-products into fungi that can be used for human consumption.
Food companies can do a lot to reduce waste throughout their supply chain. Although there is a vast array of solutions, they are more effective and beneficial if stakeholders – of which there are many in the food industry – partner up to tackle waste. This requires sharing information between companies. Blockchain partnerships can be used to increase trust and boost transparency.
Together, we can build a food system that is zero waste and circular by design.
Alliances allow companies, governments, research institutions and NGOs to harness their collective power, resources and technical expertise to create the transformational change that is needed. The possible value cases for preventing, reducing and upcycling waste are limitless. As waste reduction benefits all stakeholders across the value chain, it makes sense to partner up to create the most impact. Together, we can build a food system that is zero waste and circular by design.