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(Copenhagen 20. august) Each day, 870 million people across the globe go to bed hungry at night. At the same time, one third of all food produced globally is lost or wasted. What’s more is that annual food loss and waste is expected only to grow between now and 2030, according to detailed Boston Consulting Group (BCG) modelling. If we are to halve food loss and waste (FLW), which is a UN Sustainable Development Goal (SDG 12.3), we need to understand precisely how and where food loss and waste occurs – and what solutions we can bring in to play to address this.

The scope of the problem is quantified and the opportunity to address it are outlined in the research by BCG. The article, titled Tackling the $1.6 Billion-Ton Food Waste and Loss Crisis, was released in Copenhagen today. The research emphasises that aggressive action by companies, agricultural players, governments, and others is required to stem the tide.

Detailed projections reveal  food loss and waste is expected to hit 2.1 billion tons by 2030, which is worth US $1.5 trillion. It also outlines five key drivers of the problem: lack of awareness of the issue among consumers and others, inadequate supply chain infrastructure, supply chain inefficiency, a lack of collaboration among groups across the food value chain, and poorly designed tax and regulatory policies. For each driver, BCG estimated the opportunity for waste and loss, with the total reaching nearly US $700 billion annually.

“Roughly one-third of the food produced around the world goes to waste,” says Esben Hegnsholt, a BCG partner and co-author of the publication. “This represents a challenge so massive that it was included in the United Nations Sustainable Development Goals. But while it is a daunting problem, there are steps that can be taken today, actions that draw on currently available technology and know-how, to dramatically slash waste across the value chain.”

New focus for Food Loss and Waste efforts

While the waste that occurs at the consumer end-point normally is the focus of efforts to reduce FLW, the research reveals that the greatest reductions in global FLW numbers will occur if focus is shifted to what happens during food production, logistics and transportation. By analysing the entire food production value chain – from the initial harvesting phase to the moment it reaches the end consumer, the report identifies substantial issues at the production/handling stage and during consumption. Successfully addressing them will not only fulfil SDG12.3 ahead of schedule, but also prevent the squandering of resources such as energy, water and labour that take place when food is lost or wasted, thus reducing the global carbon footprint. There is also enormous potential for the companies that possess the tools and technology to solve the challenge.

For example, the research estimates that digital optimisation of value chains will reduce FLW by 120 million tonnes, which has a business potential of US$150 billion. Similarly, by instituting cold-chain logistics, FLW can be reduced by 270 million tonnes, which has a business potential of US $180 billion.

The Need For Company Leadership

The research also identifies 13 concrete initiatives that companies can take to address the problem. These include:

  • Educating farmers, consumers and company employees on the issue of food waste and steps they can take to reduce it.
  • Improving supply chain infrastructure for the food industry, including investment in cold chain systems.
  • Adopting digital, big data, and other tools to slash waste and developing company KPIs and processes to drive reductions.
  • Improving collaboration across the food value chain, including between agricultural producers and food processors.
  • Advocating for changes to regulations and tax policies that would reduce waste and encourage repurposing of food

“Many stakeholders have a part to play in combatting food waste, but the role of companies is perhaps the most critical,” says Shalini Unnikrishnan, a BCG partner and co-author of the publication. “Companies are involved in every aspect of the food supply chain, from production through to consumption, and as a result, their decisions and actions have an outsized impact. At the same time, they have deep expertise and insight on potential solutions—and the resources to invest.”

The article explains how companies that take action stand to reap tangible business benefits, including lower costs, the opening of new markets and new revenue opportunities, an elevated brand, and an enhanced ability to attract and retain talent. This compelling opportunity provides a way for companies to achieve societal impact and deliver business value.

A copy of the article can be downloaded here.