- Date:
- Author:
- Stefano Montobbio
The global agricultural food (agri-food) system is under immense pressure to simultaneously meet the needs of a growing population and produce food in a more sustainable way.
The complex relationship between food production and sustainability
The sustainability focus of many countries, regulators, investors, NGOs and social movements around the world is currently directed at mitigating climate change and the need to reduce greenhouse gas (GHG) emissions. The requirement to move away from fossil fuels and revolutionise energy production in favour of greener alternatives is now well embedded in common opinion.
Nevertheless, there is another revolution that needs to be better understood, reinforced and appreciated. It is the food chain revolution. Here, the concept of sustainability has more relevance than first anticipated. The planet’s food system is far from resilient and produces negative effects on the environment, the climate itself and, ultimately, our health. Never has so much affordable food been delivered by the agriculture food (agri-food) chain. Yet, this is happening at the expense of future generations. Moreover, it has reached a critical juncture and may be approaching a declining phase: a reduction of output could lie just around the corner.1
The agri-food system currently creates a dangerous reinforcing loop which exacerbates the planet’s climate change issues. As such, the green revolution cannot happen without a food revolution. In fact, it may surprise many to discover that the food chain – from production to distribution, consumption all the way through to food-waste – is responsible for between 25% and 30% of GHG emissions.2 A good proportion of this is linked to methane released by livestock and their waste.
It is somewhat surprising then that public opinion focuses mainly on green energy considering the food-chain arguably has far more impact on the rate of CO2 emissions. One of the reasons of this low awareness, or concern, might be linked to the fact that reducing emissions in the food chain is much more complex than switching from oil to wind or solar energy. Additionally, as humans, we don’t like to hear the uncomfortable truth.
The food agriculture food sector is being impacted by climate change and in turn causing it
The whole food chain has a perverse relationship with climate change, being both victim and perpetrator. Agriculture is interconnected with the climate, biodiversity, urbanisation, resource scarcity and demographics. According to the UN, the human population will grow from the current 7.7 billion to 11 billion towards the end of this century. As a result, our food systems will have to feed around 40% more people, while at the same time reducing GHG emissions.
So, we need more agricultural land, but we cannot cut trees that absorb CO2 emissions; we need better irrigation, but water is becoming more and more scarce; we need greater productivity, but we have to refrain from using traditional fertilisers based on damaging phosphorous and nitrogen.
Even more worrisome, the thickness of topsoil – the portion that contains organic matter and nutrients for plants and crops – is slowly decreasing because of the combined action of intense use and heavy rainfall resulting from changing climate patterns. We are approaching a threshold below which crop productivity will be reduced. In this context, humankind might be required to expand land to raise animals: The UN’s Food and Agriculture Organization estimates we need 70% more animal products by 2050 to feed the world,3 but this expansion cannot take place at the expense of agricultural land nor forests. Perhaps this is why we are so determined to find out whether Mars can support life?
Additionally, meat and dairy production has a big impact on pollution: 2,500 dairy cows pollute the atmosphere at a comparable amount to a city of more than 400,000 people.4
Food waste is another huge source of methane emissions, not to mention the significant ethical implications. According to the European Economic and Social Committee, more than 170kg of food waste per person is produced every year.5 Better packaging to protect and conserve food for longer is required, but we now seek plastic alternatives. In 2017, each person living in the EU generated an average of 173kg of packaging waste.6
What new opportunities has the food revolution presented?
The harsh reality is that our food system needs to be completely redesigned and the incongruities aforementioned must be solved. Partial solutions include: aquaculture (controlled farming of fish and other aquatic organisms); vertical farming (growing crops in vertically stacked layers); cleaner fertilisers; precision agriculture (technology enhancing farm production); move to a circular packaging system (reduce single-use packaging); and of course, a radical change in consumer habits.
Innovative solutions need then to be sustained by regulators through taxes, incentives, public procurements, awareness campaigns, standards and labels.7 As this dynamic evolves, some companies, industries and activities will innovate and prosper, others will slowly die.
The challenge to reinforce our food system is immense which can only be solved through concerted and co-ordinated action between governments, businesses and consumers – ourselves included.
Footnotes
1 USDA NASS; “Determining Climate Effects on US Total Agricultural Productivity”, Liang et al, Proceedings of the National Academy of Sciences, 2019. GMO, The race of our lives, revisited, 2017
2 UN IPCC Fifth Assessment Report (2014); UN FAC Food Wastage Footprint (2013); https://www.universityofcalifornia.edu/longform/where-do-greenhouse-gas-emissions-come
3 FAO, More fuel for the food/feed debate, http://www.fao.org/ag/againfo/home/en/news_archive/2017_More_Fuel_for_the_Food_Feed.html
4 https://youaretheirvoice.com/resources/the-daunting-facts-print-friendly-en.pdf
5 https://www.europarl.europa.eu/resources/library/images/20170512PHT74421/20170512PHT74421_original.jpg
6 Recycling food packaging & food waste in plastics revolution, European Economic and Social Committee, 2020
7 Cit. Recycling food packaging & food waste in plastics revolution, European Economic and Social Committee, 2020
Important Information
The value of investments and the income derived from them can fall as well as rise, and past performance is no indicator of future performance. Investment products may be subject to investment risks involving, but not limited to, possible loss of all or part of the principal invested.
This document does not constitute and shall not be construed as a prospectus, advertisement, public offering or placement of, nor a recommendation to buy, sell, hold or solicit, any investment, security, other financial instrument or other product or service. It is not intended to be a final representation of the terms and conditions of any investment, security, other financial instrument or other product or service. This document is for general information only and is not intended as investment advice or any other specific recommendation as to any particular course of action or inaction. The information in this document does not take into account the specific investment objectives, financial situation or particular needs of the recipient. You should seek your own professional advice suitable to your particular circumstances prior to making any investment or if you are in doubt as to the information in this document.
Although information in this document has been obtained from sources believed to be reliable, no member of the EFG group represents or warrants its accuracy, and such information may be incomplete or condensed. Any opinions in this document are subject to change without notice. This document may contain personal opinions which do not necessarily reflect the position of any member of the EFG group. To the fullest extent permissible by law, no member of the EFG group shall be responsible for the consequences of any errors or omissions herein, or reliance upon any opinion or statement contained herein, and each member of the EFG group expressly disclaims any liability, including (without limitation) liability for incidental or consequential damages, arising from the same or resulting from any action or inaction on the part of the recipient in reliance on this document.
The availability of this document in any jurisdiction or country may be contrary to local law or regulation and persons who come into possession of this document should inform themselves of and observe any restrictions. This document may not be reproduced, disclosed or distributed (in whole or in part) to any other person without prior written permission from an authorised member of the EFG group.
This document has been produced by EFG Asset Management (UK) Limited for use by the EFG group and the worldwide subsidiaries and affiliates within the EFG group. EFG Asset Management (UK) Limited is authorised and regulated by the UK Financial Conduct Authority, registered no. 7389746. Registered address: EFG Asset Management (UK) Limited, Leconfield House, Curzon Street, London W1J 5JB, United Kingdom, telephone +44 (0)20 7491 9111.