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The drop in soy demand caused by the African Swine Fever outbreak in China will mean that COFCO will source less soy from Brazil this year, although the director said he hoped the group will be able to compensate by boosting corn exports. He noted that Brazil holds great potential for agricultural expansion that will be key to expand future food production. The state-controlled company said it will continue to invest in the country, although very cautiously. COFCO has already spent USD 4 billion in acquisitions recently, which enabled it to quickly grow in Brazil’s grains, oilseeds, sugar, coffee and cotton sectors. 

Argentina overtook Brazil as the largest beef exporter to China as beef sales more than doubled in the first seven months of the year. The overall protein demand has surged following the sharp drop in the local pig population. The swine fever has also impacted the supply of edible oils in China, which are produced during the processing of soybeans used to feed pigs. The country doubled its import of palm oil in August compared to last year in order to compensate. Palm oil is also replacing the beans that would have been imported from the US. 

In Indonesia, the state-owned PTPN III  – one of the largest land-owners in SouthEast Asia – said it raised USD 640 million to finance its capital and expand activities in palm oil, rubber, tea and sugarcane. The group manages 1.18 million ha of palm oil plantations. Meanwhile, the Center for International Forestry Research revealed that the deforestation rate related to palm oil on the island of Borneo has steadily been declining since 2012, mainly because of low palm oil prices and government moratorium on new plantations. The center unveiled a new tool, called Borneo Atlas, which lets anyone track deforestation on the island and the companies responsible.

Some 87 companies around the world have now agreed to join the UN’s Global Compact and align their operations to limit global temperature rise to 1.5°C. Unilever was one of the first groups to follow the pledge announced back in June, which now also includes Danone, Nestle, Novozymes, Royal DSM and Natura. Many of these companies also launched the One Planet Business for Biodiversity ahead of the UN Climate Action Summit in NY, highlighting the risks attached to the loss of biodiversity. Two-thirds of the world’s crop production is based on only nine plants: sugarcane, corn, rice, wheat, potatoes, soybeans, palm oil fruit, sugar beet and cassava. 

Similarly, Harvard joined the Cool Food Pledge and will work to reduce its greenhouse gas emissions related to food by 25% by 2030. Nonetheless, students note that the University still refuses to divest from fossil fuel investments, as the University President argues that the USD 39 billion endowment was not a tool for social change. The endowment has also tried to diversify from the risks of conventional stocks by investing in direct agriculture holdings across the world. The process was seen by many as a failure and the total value of the investments was written down from USD 4 billion to USD 2.9 billion. 

Some experts speaking at the UN summit attempted to defend the role global food trade can play in fighting climate change by disputing the idea that importing food always leads to more carbon emissions. Buying locally produced food only makes sense when the produce is in season, and driving a long distance to buy goods could emit more carbon than air freighting fresh produce from across the world, according to the Hoffmann Centre for Sustainable Resource Economy. A recent survey showed that people were also confused about how and why almost a third of all food produced is wasted. Food waste was not as much of a factor for a majority of people when dining out, while people said their biggest reason to limit waste was to save money. 

Farmers in the US highlighted that barley is particularly vulnerable to sudden weather changes, such as drought, heat or floods, which means climate change could potentially threaten our beer supply. To anticipate the issue, beer makers created the Brewery Climate Declaration and are testing other small grains such as winter barley, wheat rye or rice to ensure that future generations can also drink good beer. 

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. 

Following in Austria’s footsteps, Germany’s cabinet agreed to progressively phase out the use of glyphosate and implement a total ban by the end of 2023. In France, some 20 mayors banned the weedkiller last month. This could be a game-changer for agriculture, as a farmer in Nebraska pointed out that glyphosate and Monsanto’s Roundup Ready seeds were probably the biggest labour-saver since the invention of the tractor. That same farmer, however, was one of the first farmers in Nebraska to file a lawsuit against Monsanto after being diagnosed with non-Hodgkin lymphoma.

Some of the major scientific institutions disagree on whether glyphosate is safe but three juries in California have already ruled against Bayer – the new owner of Monsanto. Experts note that the outcome of the legal challenges might not come down to science, but rather Monsanto’s efforts to manipulate the regulatory process. In France, the government is investigating a list of potentially influential individuals Monsanto compiled in order to control public opinion. Bayer conceded that the list was created but argued that it was not illegal. 

The Environmental Protection Agency in the US explained that relying on industry studies when assessing pesticides was a common practice because companies must cover the costs of approval. It highlighted, however, that the data is shared and often collected by outside labs. The comment was in response to a second lawsuit filed against the agency which claimed that the recently approved sulfoxaflor pesticide would threaten bees, beekeepers and the whole food supply. 

In France, a public consultation was opened on the proposal to ban the use of pesticides within 5-10 metres of houses, due to come into force in January 2020. Associations argue that the distance is too small, while some mayors have already implemented a ban than can be as wide as 150 metres. The agriculture ministry warned that enforcing a 150-metre pesticide free-zone would reduce the total crop area by 20-30%. 

Meanwhile, Malaysian palm oil exporters are expected to lose market share in India following the recent 5% hike in import duty. India said the higher levy would apply to refined palm oil to protect domestic refiners. In response to hostility towards palm oil and low prices, the Malaysian government announced a plan to promote the cultivation of food crops. Palm oil is currently grown on 5 million ha, out of the 7 million ha of total agricultural area, but crude palm oil prices more than halved in the last eight years. 

The Indonesian government, on the other hand, hopes it can address mounting palm oil inventories by promoting the use of biodiesel. It recently reported that a fleet of cars travelled 42,000km on biodiesel and reported no engine issues. The plan is to increase the current 20% blending mandate to 30% next year and possibly 100% in 2021. 

China approved 25 Brazilian meatpacking plants for exports this week at a time when European countries are increasingly worried about buying meat from Brazil amid the spike in deforestation rate. Brazil already exports most of its meat to China, where the African Swine Fever (ASF) has decimated the local pig herd. The trade war with the US is also impacting the supply of soybeans and China announced that it will allow the import of soybean meal from Argentina. 

China is stepping up efforts to deal with the ASF by boosting subsidies and has even started enforcing pork rations in some cities. Last week, the government said it would release emergency stocks of frozen meat if necessary. Some estimates say China lost 100 million hogs to the disease while Vietnam said it culled 4.7 million pigs to contain the outbreak. The disease has also made its first appearance in the Philippines, despite a ban on pork imports and reinforced quarantine procedures. 

ADM was the target of two separate antitrust lawsuits last week which accused the group of manipulating prices. The first one concerns its Golden Peanut subsidiary, along with another peanut sheller Birdsong Corp, which are accused by farmers of conspiring to fix unprocessed peanut prices. The two firms control 90% of the shelling industry. The second lawsuit accused ADM of manipulating the Argo ethanol market to benefit from its short position. Some traders had already complained to S&P Global Platts that ADM was selling large amounts of ethanol on the cash market just before the market closed.

Bunge revealed that it owned a 1.6% stake in Beyond Meat. The maker of plant-based meat alternatives recently reached a market capitalisation of USD 9.9 billion, more than Bunge. Kellog and Danone joined the long list of firms planning to launch meat alternatives, while the University of Cambridge said it has removed beef and lamb from its menu to reduce its carbon footprint. A less impressive announcement came from Unilver’s Country Crock with the launch of “Plant Butter”. People quickly realised it was pretty much margarine, but with a higher concentration of saturated fat.  

Just when there seemed to be no limits to the possibilities of plant-based meat alternatives, the CEO of Whole Foods‘ warned that these alternatives were highly processed, rich in salt and fat and therefore not very good for you. Whereas he did concede that it was better than eating meat in terms of the environmental impact, a researcher at Oxford argued that it would be better still to consume unprocessed plants. He explained that “while [plant-based meat] products have about half the carbon footprint than chicken does, they also have 5 times more of a footprint than a bean patty.” And if this was making you think of waiting for lab-grown meat to be financially viable, a food anthropologist warned that it was not yet clear that this option would be much better for the environment either. 

Eating fruits and vegetables might not be as healthy as we think, according to a recent study published in the British Medical Journal. Researchers noted that, as expected, people who consume meat have a higher chance of reporting a coronary heart disease when compared to vegans and vegetarians, although it also found that vegans and vegetarians have a 20% higher stroke risk. The reasons are unclear, although experts said it could be linked to the lack of B12 vitamins in a vegetarian diet. Overall, dieticians argue that the healthiest diets involve eating a  wide range of foods.

We might also have to rethink whether buying unpackaged fresh food is better for the environment. A new study argues that the carbon footprint of food that wastes faster because it is not packaged is bigger than the environmental impact of the actual packaging. The solution, then, seems to be better packaging. 

The media backlash against Brazilian agriculture policy – which is being blamed for the fires in the Amazon – continues. ADM, Bunge and Nestle are some of the groups that have officially committed not to source from the newly deforested areas. They are using satellite data as well as ground teams to identify the affected areas. Some have blamed the Amazon fires on the US-China trade war which has led to a boost in exports from Brazil. However, Brazil’s soybean exports dropped to 5.3 million mt in August, a fall from over 8 million mt in the same month last year at the start of the trade war. On the other hand, Brazil exported a record high 7.65 million mt of corn in August, double what was exported in the same month last year.

In the US, Cargill tied up with White Dog Labs to work on a sustainable alternative to fishmeal in aquafeed using corn feedstock. It is also investing USD 75 million in Puris, which supplies plant-based meat companies such as Beyond Burger, to set up a new pea protein plant in Minnesota. 

In Ghana, the 20,000 certified cocoa farmers who supplied Cargill in 2018/19 benefitted from a combined USD 2 million in sustainability premium, an increase of 33% on year. The group buys directly from farmers who bring the cocoa to local warehouses where they are registered, allowing full traceability. Cargill also announced a USD 121 million investment in expanding its cocoa grinding plant in the Ivory Coast. 

As it continues to look for innovative solutions for the food and agriculture industry, Cargill announced the official opening of a research lab at the University of Illinois. Similarly, ADM said it would donate USD 2.5 million to the University of Illinois’ Feed Technology Center.

Bunge continues on its cost-cutting tracks and announced it was reducing headcount at its New York headquarters, which will be moving to St Louis as part of the company’s strategy to become more globally integrated. Analysts forecast that the group will probably look at selling its fertilizer business and could split the commodity trading side from food ingredients ahead of a possible sale. Glencore is seen as a potential acquirer, on the assumption that antitrust regulators would not approve a takeover or merger with ADM. 

Launched at the last G7, Danone is chairing a new initiative, Business for Inclusive Growth (B4IG), which aims to help all member companies encourage diversity and fairness throughout their supply chain. The program, which will be managed by the OECD, has already identified some 50 projects worth USD 1 billion in funding. The head of Mars, which also signed up, said, “It isn’t about philanthropy, but rather an understanding that a business can only be successful if it also enables all of its partners, community and the environment to thrive.”