Food shortage is one of the most pressing problems we face today, particularly in the wake of the COVID-19 Pandemic. You might think that food shortages are caused by insufficient production. The truth is that despite the fact that there are more than enough foods to feed the entire world population, 828 million people go hungry each year.
Food waste is the leading cause of shortages. This includes food that gets lost in transit along the supply chain and food that consumers or retailers throw out. A third of the food produced every year is wasted. This amounts to approximately USD 1 trillion. These staggering figures make one wonder what food waste is and what its impact is on the world. Let us delve deeper.
What is the main cause of food waste?
Food waste is the term used to describe a reduction in the amount or quality of food suitable for consumption, which is then disposed of by multiple stakeholders, such as retailers, food producers, and consumers, at different stages of the food supply chain. Food waste is a problem that begins long before the food reaches its final destination. It is caused by a variety of factors.
Nearly half of all fruits and vegetables are produced worldwide, and more than 20% of meat and dairy products are produced worldwide.
Food is wasted or lost annually. Food waste is a problem that affects both developed and developing nations, but the causes are different. In the United States and other industrialized countries, more than 40% of the food sold at retail is wasted. The reasons for food waste include:
Damages or spoilage in the production and supply chains
Retailers reject food for aesthetic reasons
Overspending by consumers leads to food waste
In contrast, the agricultural production process in developing countries is characterized by food losses of around 40%. During or after harvest time, many challenges can occur.
Inefficient warehouse facilities
The lack of infrastructure and technology
Supply chain challenges
Source: UNEP Food Waste Index Report 2021
The way forward for reducing food waste
Today, reducing food waste is a necessity. UN 2030 Agenda for Sustainable Development has macro-goals of “Zero Hunger” and “Sustainable Production and Consumption” and micro-goals of halving global food waste per capita at the retail and consumer level and reducing food losses throughout production and supply chain, including post-harvest losses. (ref)
To achieve these goals, individuals, corporations, and nations will need to be committed to the cause. Corporations and governments can do a lot to reduce food waste. Some of the most important ways to reduce food waste are:
* Improve food storage, processing, and distribution processes
* Manage cold supply chain efficiently to minimize damage and spoilage
Use of technology and innovation for production and supply-chain management
* Recycle food and use it as livestock feed, if possible.
* Improved forecasting and matching of demand with supply
Despite the many measures that individuals, organizations, and governments have taken to reduce food wastage, there’s still much to be done. The adoption of a technology-led cold supply chain has been emphasized more than ever. Cold supply chains are crucial in preserving food’s nutritional values and distributing it to different locations. This allows food manufacturers and suppliers to reduce food waste.
Global Cold Chain Market
A cold chain is a temperature-controlled supply chain that involves the transportation of perishable or temperature-sensitive products. By refrigerating storage and distribution of perishable goods, the required temperature is maintained to maintain quality, increase shelf life, and reduce food waste.
The logistics industry is experiencing rapid growth in the cold chain segment. Cold chain logistics will grow at a 13.5% CAGR from USD 182.5 billion in 2020 to USD 343.75 billion in 2027.
The market for cold chains is emergence due to many factors, including the increase in demand for perishable food such as fruits, vegetables, and meat, an increase in disposable income, and a change in lifestyle.
The Cold Chain Market of ASEAN
Tropical climates are more prone to spoilage of perishable goods because microbes multiply faster at higher temperatures. Cold chain and transportation systems are, therefore, essential and play a crucial role in the growth of Southeast Asian economies, enabling them to participate in the perishable product market on a global level as producers, consumers and exporters.
The quality of cold-chain services in local areas varies greatly. Consumers choose to buy frozen and refrigerated products from insulated trucks because they’re safe, convenient, and easy to access.
ASEAN’s cold chain logistics market will grow by over 12% from 2022 to 2027. The pandemic has accelerated the need for cold chain logistics, leading to major changes in operations, supply chains, and norms.
Impact of Food Waste
Food waste can negatively impact food security and nutrition. Food prices rise when there is a mismatch between the supply and demand. This makes it harder for those who are most vulnerable to afford and access basic nutrition. Food waste can have other negative effects, such as:
Food waste is a major contributor to environmental degradation. If a nation were a nation, China and the US would be its largest contributors to greenhouse gas emissions. The decomposition of unconsumed food contributes to greenhouse gases. Food that rots in landfills releases methane, which is 28 times more powerful than carbon dioxide. The production of food accounts for 26% of global emissions.
Resources are under pressure: Producing food requires a large amount of resources, such as water and land. When food is wasted, these resources are also considered wasteful. The final food product also goes through multiple production processes, which require a lot of energy and resources. If the food is not consumed, these resources are wasted.
Impact on Cold Chain Suppliers
At different stages in the supply chain, food producers and suppliers face a variety of challenges. Other factors, such as economic, environmental and consumer food habits, are also important. Financial losses are a threat to them. To prevent further damage, food producers must keep production and availability under control. A surplus of food not only leads to a decrease in the demand for it and its price but also causes waste. The lack of distribution is one of the biggest gaps between production and consumption. Hunger is a worldwide problem, despite the fact that there are more than enough foods to feed everyone. Food or products in remote areas are not available due to inadequate infrastructure, storage, and transportation.
The Role of the cold chain in reducing food waste
Food waste occurs throughout the entire supply chain and even crosses borders. It is caused by insufficient infrastructure, such as inadequate refrigeration and temperature control, during the transportation of food.
An effective cold chain can help reduce food waste. Combining technology with hardware and software to track and control the temperature of food during transit and its journey can be a powerful tool in combating food waste. Cold chain technology allows manufacturers and suppliers to maintain the quality of food for longer periods, reduce food waste, and increase profit.
Cold chain plays a vital role in the modern world. It is a key factor for improving food safety and supplying better nutrition to remote areas, as well as drugs. Cold chain integration in the supply chain has many benefits.
1. Perishable foods with a lower rate of degradation
Prevents the growth and spoilage of microorganism enzymes throughout the supply chain
2. Cost-efficiency
Extends the shelf life of food and products to reduce spoilage.
3. Quality and consistency are important.
Maintains and provides standard food quality through temperature-controlled facilities
4. Transport spectrum – a wider range
Improves exports and helps explore new markets
Compliance with regulatory requirements
Easy movement of medical and food supplies across borders
Adoption of technology-led innovation and supply chain automation, with the help of government policies, can greatly assist food manufacturers and suppliers in avoiding the challenges that arise during the supply chain. A comprehensive approach that focuses on a safe and efficient food distribution system while creating a safe work environment for employees with standardized regulations will help us fight the global food waste problem.
Godrej Korber believes in being part of the solution and not the problem. In this three-part blog series, we will discuss the importance of an effective cold supply in reducing food waste and contributing to ending global hunger.
