The world’s four largest food traders seem to have benefited from the change in trade flows amid the US-China trade war and the additional demand for Brazilian grains. In 2018, Bunge maintained its place as the country’s top soybean exporter with 17.7 million mt, a 9.2% increase from the previous year, followed by Cargill with 12.15 million mt, a 1.4% increase on year. The third and fourth place went to Louis Dreyfus and Cofco, respectively, while ADM and Olam also reported significant improvements in exports. The head of ADM is hopeful that the trade war will end this year. He argued that it had made trade flows rather complicated. For instance, Argentina, the world’s third-biggest soybean producer, imported the biggest quantity of US origin soybean.
ADM announced a plan to purchase one of the largest producers of citrus ingredients in the world, Florida Chemical Company, which could happen in early 2019, pending government approval. The company president said the move would help ADM achieve its goal of becoming the biggest nutrition company. The CEO said the group looked on average at 50 companies every year for potential acquisition. He admitted having analysed companies like Bunge, Louis Dreyfus and Cargill but said the time was not right for a ‘monster’ acquisition. He explained that joint ventures, like the one it has with Cargill in Egypt, would make more sense for the time being.
The Brazilian meat giant JBS is also expected to benefit from the trade war as the USDA announced that it will spend USD 5 million to buy 1.8 million lb of its pork, as part of the USD 12 billion aid package announced by the White House. Lobbyists are already complaining that the money is going to a foreign firm, but the USDA highlighted that the funds will be spent to purchase American-made products.
The US President’s farm support could start to waiver as farmers increasingly struggle because of the delay in the distribution of government grants and key USDA supply and demand reports caused by the shutdown. The USDA did, however, find a way to avoid a potential controversy by funding the food assistance program up to the end of February, while the FDA said that essential food inspections will continue, although it remains unclear how long inspectors will work without pay.
Dairy producers, meanwhile, are celebrating as the US government has started undoing efforts by the previous administration to make school lunches healthier. The National School Lunch Program accounted for up 7.6% of all liquid dairy sales in 2017 which helped compensate for a consistent drop in demand, as per capita milk consumption fell 40% since 1975. This marks the return of full-fat chocolate milk served at every school meal. Meanwhile, health advocates warn that one out of three American children is already overweight or obese.
In China, health advocates argued that food and drink manufacturers were successfully steering the obesity debate around the need for more exercise while downplaying the importance of food and drink in a healthy diet, as laid out by a paper published in the British Medical Journal. The International Life Sciences Institute, funded by Coca-Cola and other food makers, has enjoyed a good relation with health officials, the paper noted.
Danone confirmed that it was investing in Epigamia, a yoghurt maker in India, in order to improve its access to the value-added end of the market. Danone had left the Indian market last year after a failed foray but a spokesperson said Epigamia will be run independently. In Latin America, Danone is partnering with a specialised packaging company to develop yoghurt pots targeted to meet the growing health and environmental concerns of consumers.
In the UK, the interest in dairy alternatives and vegan foods has started to surge, as it does every January, as part of what some call Veganuary. But research by the University of Oxford notes that although all plant-based dairy drinks require a lot less land and emit less carbon dioxide, some alternatives have a larger impact than others. Rice and almond milk, for example, require much more water to make than soy or oat milk. The BBC has a useful calculator which will estimate the environmental footprints of certain food products, based on the Oxford study.
In any case, a group of scientists have come up with the “Planetary Health” diet, which would reportedly prevent millions of premature deaths as well as reduce greenhouse emissions significantly. The diet includes reducing by half the amount of meat and sugar consumed while increasing our nuts, fruits and vegetable intake. Beyond getting everyone on board, the scientists conceded that unequal access to food may be a challenge to implementing this diet.
This summary was produced by ECRUU