Commodity Conversations Weekly Press Summary

Unilever and Nestle have been talking this week about their commitment to being carbon neutral by 2030 for the former and 2050 for the latter. Nestle is giving itself two years to plan how to do it and figure out how much it will cost. An energy expert warned that the task would be difficult – and costly – in part because there was no standardised way of measuring emissions. However, Unilever said it had managed to switch to only using renewable electricity across all its operations in North America, Africa, Asia, Europe and Latin America at a net-zero cost.

As part of its strategy, Nestle said it would sign the “Business Ambition for 1.5°C” which is a global initiative focusing on fighting climate change. The CEO explained that they were working on reducing the group’s environmental footprint by using environmentally friendly ingredients, working with farmers to reduce carbon emissions as well as developing reusable or recycled packaging. It has already set up an Institute of Packaging Sciences to find sustainable packaging options. “Our vision is a world in which none of our packaging ends up in landfill or as litter,” he said. In the US, meanwhile, the group is downsizing its workforce as it transitions away from direct store delivery to using warehouses. 

McDonald’s is approaching the packaging challenge differently. It decided to test out different packaging options and get feedback from consumers via its plastic-free restaurants in Germany and Canada. The idea is to see what works before it can be implemented globally. 

Going back to Unilever, the group has been accused by a Mexican organisation of falling short of its commitment to fortify its corn flour products with vitamins and minerals as is required by law. The group registered USD 190 million in sales in fortified food last year, ranking second in the global Access to Nutrition Index. Analysts say that this specific food and beverage sector is expected to grow 24% within 5 years. In Greece, Unilever is working with the WWF on a pilot project to reduce food waste at three hotels. Customers are given notes urging them to carefully consider how much food they put on their plates during buffet meals. The hotels have also tried to reduce the availability of buffets in favour or meals that need to be ordered. 

Meanwhile, a blockchain-enabled sustainability and traceability project started by WWF Australia and BCG Digital Ventures’ managed to raise USD 5.8 million in funding. The idea behind OpenSC is to use technology to identify and earmark sustainable supply chains and then help customers learn about them. An official involved explained that this would not replace certifications but aims to help bridge the gap between customers and producers. 

Cargill announced it was exiting asset management and selling its share in CarVal Investors, explaining that it wanted to focus on businesses where it was more actively involved. Cargill and Maersk Tankers are pooling together some of their Medium Range (MR) fleet, combining the former’s trading expertise with the latter’s digital capabilities to become more flexible and efficient. In India, Cargill opened a USD 10 million 60,000mt corn silo in Karnataka, its first foray into bulk storage in the country. 

In the US, Cargill is upping its marketing efforts on beef packaging to highlight the meat’s protein level after the group identified that other meat products advertised their protein content better, leading consumers to believe that beef had less protein than it did. In New York, meanwhile, local residents are protesting Cargill’s use of seismic testing ahead of an expansion of a salt mine near Cayuga Lake. The residents are concerned about the effects on local wildlife as well as possible contamination of the lake water but Cargill argued that the seismic testing was used specifically to identify and prevent environmental damage. 

Bunge is acquiring 30% of Brazil’s agricultural group Agrofel as part of its plan to increase origination from farmers, especially soybeans. The group, which has 450,000mt in storage capacity, originates about 1 million mt of grains annually. In Asia, meanwhile, Olam was granted a USD 525 million loan linked to sustainability Key Performance Indicators. The funds will be used to finance their current loans. 

Subscribe to Blog via Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Leave a Reply

Your email address will not be published. Required fields are marked *