One-third of the food produced in the world is never consumed. Improving supply chain efficiency is one way to feed Earth's 800 million hungry people.
In recognition of World Food Day, Answers On is exploring how data, human intelligence and expertise can be applied to fight global hunger.
The Food and Agriculture Organization of the United Nations estimates one-third of all food produced worldwide, or about 1.3 billion tons, is lost or wasted. That’s an astonishing amount of nutrition going unused in a world where hunger kills more people each year than malaria, AIDS and tuberculosis combined.
In many cases, food not reaching a human consumer is caused by kinks in the supply chain. Food makes for unforgiving cargo – perishable meat, produce and dairy products don’t leave much margin for error – so even small gaps, hold-ups and oversights become very consequential.
Food loss and food waste
According to FAO Agro-Industry Officer Robert van Otterdijk, food that does not reach its final point of consumption is properly termed food loss. Most often, it’s a case of unintentional decay or damage. An example would be a truckload of tomatoes spoiling in the heat on their way from the field to the warehouse.
Food that does reach its final consumption but, for some reason, is not eaten is called food waste. Chicken that is processed, transported to the grocery store and purchased, only to go unused past its sell-by date in the consumer’s refrigerator is an example of food waste. Food waste is significantly more prevalent in developed countries than it is in developing countries.
Both food waste and food loss represent a squandering of the water, soil and labor that went into raising the food. Food that is grown but not consumed also impacts worldwide prices; when developing nations adopt a casual attitude toward wasting food derived from cereal grains, for example, it can make those cereal grains more expensive in developing nations where people are least able to afford a price increase. Needless to say, food waste and food loss also mean vital nourishment is not getting to the 800 million people the FAO estimates suffer from hunger.
Is supply chain efficiency the answer?
There are many ways to fight world hunger, of course, and many of them entail simplifying, shortening or streamlining food supply chains.
“One clear avenue to increase regional food system resilience would be through the systematic reduction of food waste through the entire supply chain,” wrote the authors of The Risks of Multiple Breadbasket Failures in the 21st Century: A Science Research Agenda, a paper co-sponsored by Thomson Reuters.
One tactic: More local food sources, meaning shorter supply chains and thus fewer points where food loss and food waste could occur. While greater quantities of regionally grown food may be appealing, a large-scale shift may not be realistic. Not all regions of the world are suited to producing food in quantities, and smaller-scale growing operations have struggled economically over the past half-decade. That means we must work for greater efficiency and tight, seamless supply chain too.
“Improving the efficiency of the food supply chain could help to bring down the cost of food to the consumer and thus increase access,” the FAO wrote in its paper Global food losses and food waste – Extent, causes and prevention.
Of course, a task like “improving efficiency” is easier said than done. Some techniques for this might include:
- Supply chain risk management ensures that we produce safe food, manage food waste, reduce risk and develop a more sustainable and well-managed supply chain.
- Monitoring and managing price, supply, and supplier risk helps to achieve these objectives. Knowledge of how the global markets are interacting and the impact this has on supply disruptions — whether it’s production, logistics, or compliance and regulatory issues — can help drive efficiencies and enable organizations to adapt their supply chains to the changing conditions.
- Predictive analytics capabilities based on the outcome of historical events can allow for food industry professionals to adapt and shape demand planning to fulfill the consumers’ needs most efficiently.
- When organizations conduct thorough due diligence on suppliers, they enhance transparency, leading to greater awareness of food quality issues and enhancing their understanding of safe processes and operating controls that could prevent food crime.
Ultimately, streamlining and improving the supply chains to safeguard our food supply will require a sustained, multi-faceted approach. It won’t be easy, but it will be worth it.
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