Posts

Extreme and unpredictable weather conditions across the world, combined with supply chain disruptions and stockpiling caused by the coronavirus, are pushing up the price of many essential crops. The US, Russia and parts of the EU are facing extremely dry weather, while Vietnam, Malaysia and Indonesia have seen crops destroyed by storms and floods. The situation is even more complex when you factor in the sharp drop in the commercial flights which usually collect weather data. Meteorologists warn that they are struggling to make weather forecasts as a result. 

At the same time, China is maintaining its buying spree. The country is expected to issue additional corn import quotas to replenish reserves and meet feed demand for the growing hog population, according to sources who said COFCO was already benefiting from an additional quota. The surge in Chinese demand is also helping other trade houses like the US-based Scoular. The 128-year-old group has reported a spike in sorghum shipments since the Phase One trade deal was signed in February. And ADM sold the first shipment of US rice to China. The California-grown rice was unloaded in China this week and marks the culmination of a decade of regulatory and political work.

The food sector is in a much better place to deal with further coronavirus waves as it has set up systems to shift the food usually delivered to restaurants and caterers to retail stores. Besides, the head of ADM highlighted that being a global company provided clear advantages to deal with a worldwide pandemic. Highlighting ADM’s 118-year history, he mentioned: “That’s what our company does: it adjusts constantly”. Health experts are not so confident about the meat packing sector in the US, however, despite claims by JBS and Perdue Farms that they are prepared for further outbreaks. The major risk factor remains the speed of processing lines, while most plants are still running at the high rates authorised by an emergency decree.

While the first wave of stockpiling was categorised by a focus on comfort food and trusted brands, Nestle noted that consumers were now focusing on healthier purchases. The firm’s health-science unit reported better than expected sales thanks to a growth in demand for vitamins, minerals and supplements. Unilever reported a similar trend and has been working on making some of its products healthier. To be sure, people are still buying comfort food and Unilever revealed that sales of at-home ice cream had fully offset the drop in out-of-home sales.​

Not to be outdone, ADM’s health department said it would increase the production of probiotics five-fold thanks in part to the expansion of a factory in Valencia, Spain. Bayer, meanwhile, signed a USD 4 billion deal to buy Asklepios BioPharmaceutical. The gene therapy firm is looking to use a harmless virus to deliver “genetic repair kits”. 

Further out in the field of future food science, the debate is growing on whether lab-grown meat will ever be able to compete with traditional meat or its more direct rival, plant-based meat. Sceptics highlight that cost and perception will remain the main challenges for widespread adoption. Nonetheless, some firms are reportedly making lab-grown beef patties for just EUR 9, compared to the EUR 250,000 it took for the first experiment in 2013. The sharp drop in cost is similar, or even faster, than the scaling of the Internet and other digital technologies. One analysis suggested that Moore’s Law could be a good way to predict the future of the sector. 

The head of Impossible Foods certainly has a strong opinion on the subject as he argued that cultured meat is “never going to be a thing. I’d put any amount of money on that.” The cost involved makes the technology much more suited for therapeutic use, he added. Nonetheless, some 80 start-ups are currently studying lab-grown meat and one hopes to launch seafood products made from fish cells in mid-2021. Another group, Israeli-based Aleph Farm, is focusing on using its cell-based 3D bioprinting meat platform in space. After a successful test on the International Space Station, the firm is now partnering with space agencies to develop a solution suitable for Mars. 

Some promising progress is also being made to make traditional meat production more sustainable. Aemetis announced that it had started producing biogas from the methane collected at two dairy operations. The renewable natural gas is then processed into fuel ethanol at a Keyes, California, plant. The group hopes to expand the project to 17 dairies next year.

Amid all this talk of potential food disruptions, Oreo fans can rest easy as Mondelez built a vault to protect the cookie from disasters, including an asteroid that is expected to pass close to the Earth in November. Called the Global Oreo Vault, the facility is built right next to the Global Seed Vault in Svalbard, Norway. 

This summary was produced by ECRUU

The EU’s agriculture ministers agreed this week that 20% of the new Common Agricultural Policy (CAP) budget which will kick in 2023 should be used for environmentally friendly farming. However, the proposal still has to be voted by Parliament and environmentalists complained that the amount was much too low and translated into massive ongoing subsidies for traditional agriculture. The EU Parliament is also due to vote on a bill proposing that terms such as “sausages” and “burgers” could only be used for products containing meat, even when used with words such as “style” and “like.” An analysis by the BBC said this would take the 3-year old ban on terms like “soya milk” and “vegan cheese” one step further. 

The WWF, meanwhile, is advocating moving away from the meat vs plant debate towards a “Planet-based diet.” The idea is to focus on consuming foods that are produced locally and sustainably while providing us with our nutritional needs. The organisation points out that biodiversity loss is caused by different factors depending on the geography and that advocating for a vegan diet doesn’t make sense everywhere in the world. To help us make the right choices, the WWF designed a Planet-Based Diets Impact and Action Calculator. 

Going local is not on top of governments’ priorities right now, as they focus on ensuring they have sufficient food supply. An analyst explained that consumers and supermarkets have switched from “just-in-time” inventory management to “just-in-case”  in the anticipation of supply disruptions due to the coronavirus. The Bloomberg Agriculture Subindex rallied 20% since June as countries such as China, but also in the Middle East and Africa, stepped up purchases. The additional demand is helping farmers, notably in the US where producers have also benefited from higher buying from China under the Phase One trade deal. Another element contributing to the income of US farmers is the record high USD 51 billion in federal aid they will have received this year, an analysis by Reuters showed. The aid should amount to about a third of farm income in 2020, which will overall be higher than in 2019. 

Danone, which lost a quarter of its market value in 2020, could divest from businesses worth as much as EUR 500 million (USD 592 million) in revenue, as well as downsize some units by up to a third, the CEO said. Bloomberg Intelligence suggested that the company didn’t have much of a choice but to shed assets, arguing that Danone was “way behind the curve.” He added that this would not be enough and the group may need to sell more businesses, including some of its water brands. 

This is exactly what Nestle is doing. Sources say that the group is looking for bids for its North American water brands which have been losing market share. Analysts estimate that the brands could be sold for anywhere between USD 3-5 billion. On the other hand hand, the CEO said he is planning to keep premium brands like Perrier and San Pellegrino. 

The Coca-Cola Company said the coronavirus had contributed to accelerating its portfolio review. It announced it would stop producing a number of drinks, such as Coca-Cola Life, to free resources for higher-margin products. The virus also fast-tracked changes that were taking place in the group’s marketing strategy – an official explained that they were now focusing on more “meaningful” advertising. 

The CEO of Unilever warned, meanwhile, that more and more companies were making sustainability commitments to appeal to consumers without any plans to stick to them, also known as “woke-washing.” Ironically, he made the comment just as Greenpeace accused Unilever of “greenwashing.” The NGO conceded that the group has been vocal about becoming more sustainable but argued it needed to do much more. 

A study looking at several carnivore species in the US Midwest found that predators were getting close to half of their food from humans, by eating through garbage, foraging fields and even eating pets. One of the scientists told Wired that the presence of corn in their systems revealed the source of their food, explaining that “Human foods look like corn, because we give corn to everything.” 

Going back to the subject of eating locally, the coronavirus-led surge in gardening has caused a shortage of Mason jars in the US. Many people have used the time at home to plant food stuff which they have been canning for preservation, causing the shortage in canning containers. A jar merchant called it “Sourdough 2.0.”

This summary was produced by ECRUU

The UN’s World Food Program (WFP) was awarded the Nobel Peace Prize this week for its work on “bettering conditions for peace”. The award comes as the agency recently warned that the coronavirus pandemic will double the number of acutely food-insecure people and the Nobel Committee highlighted that food and violent conflict often interact as part of a vicious circle. Researchers, however, argued that the link between food assistance programs and peace is not so straightforward, as food aid can in some cases exacerbate armed conflicts. The WFP’s work will need to go hand in hand with conventional peace-building efforts, experts argued. 

Food assistance programs have been evolving to better reflect the economic reality of agricultural development. The WFP and others are increasingly donating cash instead of food in order to encourage the local production of food crops. Besides, some argue that ending systematic hunger is a worthy goal in itself. In response to the prize announcement, Cargill said it would match the USD 1 million donation offered to the WFP by the Nobel Committee. 

In Brazil, the less-talked-about Pantanal region is suffering from fires that have destroyed 22% of the whole area since January, a NASA scientist estimated. The destruction and uncontrollable fires were caused by a complex combination of drought, more ranchers clearing land, bureaucratic inaction and climate change. Even the fires in the Amazon are affecting the region by limiting the amount of water available. 

As the deforestation rate in Brazil keeps accelerating, experts doubt whether or how food corporations will be able to completely monitor their supply chain. One investigative piece looking at COFCO’s soy supply chain in the Cerrado highlighted a lack of transparency. Moreover, COFCO only pledged to monitor its direct soy supply chain entirely by 2023, without mentioning indirect suppliers. In response, COFCO said it was also looking to monitor indirect suppliers, just as observers noted that the Chinese group recently received a USD 2.3 billion loan linked to its sustainability performance. 

France announced new restrictions on the use of glyphosate as it prepares for a full phase-out by 2021. A few days later, the European Court of Justice ruled that EU nations were indeed allowed to ban pesticides or regulate their use even if they are allowed at the EU level. Activists hope this will encourage more member states to impose their own bans. 

Going further, civil groups are looking to ban the production and exports of pesticides in the EU. Some 41 pesticides banned in the EU were exported by the bloc in 2018 to countries with weaker environmental laws. Lawmakers argued that exporting dangerous pesticides was not only hypocritical but could also lead to pesticides being imported back into the EU via food imports. 

After glyphosate, Bayer and BASF are now fighting to maintain the authorisation to use dicamba in the US. The herbicide was found to drift to neighbouring farmlands and Bayer has already paid USD 400 million to settle legal claims. The two German groups are now saying that dicamba can be mixed with other products to stop it from spreading. 

The IEA commented that the global demand for oil will not peak but plateau by 2040, in part because some of the changes caused by the coronavirus pandemic could actually encourage oil consumption. Regardless, some food activists have now turned to another concept: peak meat consumption, as they note that growing environmental concerns could lead to an overall long-term decline in meat demand. Some were quick to point out key differences between oil and meat, however, like the fact that sustainably produced meat can actually help the environment by sequestering carbon or improving soil health. 

In the same vein, the World Sustainability Organization launched a certification program to ensure that plant-based seafood is sustainably produced. The segment has huge growth potential especially in Asia, the organisation noted, as it highlighted the importance of building trust with consumers surrounding the environmental benefits of plant-based alternatives. 

Beyond the environmental credentials of plant-based alternatives, the sector is facing a bigger challenge when addressing potential nutritional advantages, as many products are being criticised for being highly processed and high in additives. Nevertheless, experts explained that consumers these days are more focused on taste and protecting the Earth. In the long-term, some say plant-based meat should merely act as a tool to help people cross-over to a conventional plant-based diet which can have significant nutritional advantages. 

In the meantime, food and drink producers are looking for creative ways to deal with the immediate consequences of climate change. The wildfires in California, for example, are giving grapes an unwanted smoky flavour, making it unsuitable to make wine. In response, one winery is using the grapes to make brandy which should benefit from the smoky aromas. Whether the idea works will only be known by the end of 2021 as the brandy is still undergoing its ageing process. 

This summary was produced by ECRUU

European and UK negotiators have reportedly made some progress on reaching a free trade agreement although EU officials note that some open issues still need to be addressed, such as fisheries and state aid. The UK has set a deadline of October 15 to reach an agreement and the Prime Minister said he was open to a deal in line with what Australia has with the EU. However, commentators pointed out that there was no trade deal between Australia and the EU, while Australia has been looking to sign a full trade agreement with the block for years.

The UK did report a trade win this week as the country exported its first shipment of beef to the US in 20 years. The US banned imports in 1996 following issues with the mad cow disease but ruled that safety standards were acceptable again in March this year. The UK government estimates that this could generate USD 85 million annually over the next five years. This remains only a small victory, however, as the UK could lose USD 174 billion every year for 10 years with the combined impact of a no-deal Brexit and the coronavirus pandemic, according to Baker McKenzie. 

Food imports into Iran might become even more difficult if the US moves ahead with a plan to extend its sanctions and cut the country off from the global financial system. Essential goods should be exempt from the sanctions, in theory, but banks are reluctant to facilitate deals because of the fear of facing penalties. Besides, EU and Swiss efforts to set up alternative payment channels have only had limited success. Iran has been focusing on trade with the UAE and China in the meantime. 

As countries look to negotiate new trade agreements, industry members are busy trying to reduce the environmental impact of transporting commodities by ship. Sea Cargo Charter was launched by a coalition of 17 companies, including ADM, Bunge, Cargill, COFCO and Louis Dreyfus. The group set up a standard to transparently report shipping emissions to help meet greenhouse gas targets. In the same vein, Cargill will let its customers access CocoaWise, a portal set up to centralise the sustainability data of the cocoa supply chain. The solution includes a map with details on 128 cooperative offices in Cote d’Ivoire, 7 buying stations in Ghana and 11 stations in Cameroon.

Campaigners submitted a petition with 300,000 signatures urging Nestle to reconsider its decision to stop using Fairtrade cocoa and sugar in its Kit Kat bars. In response, Nestle highlighted that they are now sourcing Rainforest Alliance certified cocoa instead. They also argued that, along with its own Nestle Cocoa Plan, they are now in a better position to help improve the livelihoods of farmers. 

In the plant-based food world, oat milk just overtook soy milk to become the second most popular non-dairy milk. Oat milk has been gaining in popularity because of the low amount of water it needs to grow and the high protein and fiber content but almond milk remains the most popular in part thanks to its health advantages: it is low in calories, fat and carbohydrates.

Shoppers might be seeing a lot more plant-based products on sale following pledges by Tesco and Asda to boost sales. Tesco partnered with the WWF to increase sales of plant-based meat by 300% by 2025, while Asda is launching 104 new plant-based products. The move was not welcomed by the head of the National Sheep Association, however. He highlighted that it was based on an incorrect assumption, as meat can, and often is, produced in a sustainable way, while plant-based products are often mass-produced, highly industrialised and highly packaged.

Other experts are also questioning whether overselling the potential benefits of agricultural practices can actually undermine the fight against climate change. Environmentalists have recently been eagerly promoting the idea of regenerative agriculture to sequester the carbon in the atmosphere into the soil. But some proponents argue that the practice could actually absorb all of the carbon we currently emit. Such a claim is not only baseless, some experts say, but can also overpromise and simplify a complex problem that will require a whole suite of changes to solve. 

Talking of smart technological solutions to fight climate change, farmers found two clever ways to use agricultural products in surprising places this week. The first is in the Netherlands where researchers made bitumen – usually produced from fossil fuels – using lignin. And in the UK, the largest dairy cooperative, Arla, started converting some cow manure into methane and biofuels to power its trucks. 

This summary was produced by ECRUU

Germany has gone all out to contain the African Swine Fever (ASF) which was detected this month in a few wild boars but already cost the country a ban on exports to China. Even though no commercial pigs have tested positive, one expert estimated that Germany lost a USD 1 billion market in just one day from import bans. He calculated that the world’s pig population dropped by at least 25% because of ASF, whereas China lost about a third of its pig population since 2018. The US and Spain could fill in the gap but an analyst warned that the situation was very volatile. A second Covid-19 wave could have a drastic impact on both pork consumption and supply. 

China is also asking importers to be careful about sourcing frozen food and seafood from countries with big Covid-19 outbreaks. The government said it had found the virus in imported cold-chain food. The WHO still maintains that one was unlikely to catch the virus through food. 

The growing demand for salmon has led to its wild population dropping by half in the last 50 years. Beyond overfishing, sea lice, which spreads from fish farms to the wild, also contributed to the fall in population. US startup Wildtype is working to solve the issue with their lab-grown salmon. For the moment, it cost them USD 200 to make a spicy salmon roll but they hope to commercialise their salmon within the next 5 years. 

US-based plant-based protein company Puris is hoping to solve the issue of the high sodium content in alternative burgers with its new low-sodium pea protein. The CEO explained that plant-based burgers have much more salt than meat burgers, with one Beyond Burgers containing 16% of our daily allowance. The group, which will be doubling its pea protein production by next year, is also launching lupin flour and pea syrup, to be used in keto products and as a substitute for corn syrups. Similarly, ADM launched a series of plant-based proteins designed to improve the “sensory appeal” of plant-based meat, including textured pea proteins and textured wheat protein. 

The British Retail Consortium calculated that new import tariffs as a result of a no-deal Brexit could cost households an additional GBP 112 in food expenses, and probably more once the administrative costs are also taken into account. It explained that the UK’s food supply chain works on very little margin, which means most of the additional costs would be passed on to consumers. Besides, the recently launched Future British Standards Coalition is lobbying against any lowering of food standards after Brexit. A specific point of contention is the import of chlorinated chicken from the US – something opposed by many in the UK. 

Some 200 global food suppliers joined a voluntary coalition committing to reduce their food waste by half by 2030. An insight by Food Dive, however, points out that 80% of the world’s food waste happens in supermarkets, restaurants and with the end consumer. Nevertheless, it expects the commitment to eventually happen as it will help boost these companies’ bottom line. One solution is being tested in Kenya, where a farm is feeding food waste to black soldier fly larvae which will then be used for animal feed. 

If fighting waste was not enough, Walmart declared its commitment to becoming a “regenerative company.” The CEO Explained that “Regenerating means restoring, renewing, and replenishing, in addition to conserving.” Concretely, the target is to reach zero net emissions by 2040, restore 50 million acres of land and 1 million sq m of ocean by 2030. 

Funding and incentivising sustainable farming is a growing issue, one that a new fund hopes to solve in Brazil. Saff, the product of a public-private partnership, will start with USD 68 million in 2021, aims to reach USD 1.4 billion by 2026 and will target farmers who follow the crop-livestock-forest integration on at least 5% of their area. In the UK, McDonald’s tied up with McCain to set up a GBP 1 million fund, called the Sustainable MacFries Fund, to help potato growers become more sustainable.

We live in an era where we are used to questioning the things we’ve been doing but here’s one you probably didn’t see coming: you shouldn’t use boiling water to make tea. An expert explained that the habit of boiling developed when water was unsafe to drink. Instead, he suggests using water at 50-65 degrees for green tea and 80 degrees for most breakfast teas. Otherwise, he warned, your tea will taste “no better than cabbage water.”

This summary was produced by ECRUU