The most fundamental drivers for change in the food system are the requirements for food security and the need to tackle the climate change. In a global situation that is more fragile than ever, we need a system-level change towards increased resource efficiency and reduced environmental impact of food.
The food system – ranging from the input production to farming operations, food industry processing, and eventually reaching the consumers – has traditionally focused on increasing food production on all levels, from global to local. Globalization of production and supply chains has been a key trend, and food production has increased substantially to keep up with population growth.
The hidden costs of food: a leap in sustainability is required
Although food security has been met relatively successfully with increased production, the other major challenge – food production with acceptable environmental impacts – has not been met. As a consequence, the planetary boundaries are at risk of being exceeded.
The global food system is responsible for a major part of the environmental impacts of the society. We are already exceeding three important planetary boundaries: climate change, rate of biodiversity loss, and interference with nitrogen and phosphorus cycles. These are the “hidden costs of food” that are eventually paid by everyone on the planet Earth.
What we need is a system-level change towards radically reduced environmental impact of our food. A leap in productivity, transparency, and predictability in all parts of the global food system is required.
System-level change: what does it mean for the food chain?
System-level change is about profound, large-scale changes – in co-operation with all operators throughout the system – on how companies operate, how regulations allow the market to operate, and what is rewarded by public policies.
In the global food system it means that the “cost of food” – including the “hidden costs” – needs to be thoroughly understood. Increased production cannot be the sole goal of the system. Instead, increased production with acceptable costs to the environment needs to be the main goal.
To change everything, we need everyone
The future is linked to every market participant’s ability to renew their strategies to meet the changing needs. Reduction of the environmental impact should become part of all business and operating models throughout the food chain, from farmers, dairies and suppliers to food production, processing and resale – in co-operation, towards a common goal.
Completely new markets and value propositions are already being created, such as the carbon offset market and commercial models for carbon mitigation and mechanisms enabling input suppliers to “sell yield” rather than physical agricultural inputs.
Furthermore, as the food system is heavily Influenced by public financing and regulations, there is a need to ensure that public interventions cease to reward environmentally negative practices.
As in any other global industry, digitalisation is one of the most profound factors shaping the future of the whole food system – and it is also at the very core of Mtech´s value proposition. Our future is linked to our capacity to renew our operating model and strategy to meet the changing needs of our customers.
To learn more about what all this means to private enterprises in the food system, read our blog article “ Opportunities in system-level change towards sustainable food”