Many of you have asked me how I get my ideas when I blog something - sometimes, it comes naturally, because there is just so much content on the internet nowadays; other times, it is all just about sharing your day-to-day experiences or some topic that you thought was worth blogging about. Other times, a few things just happen and you get your ideas from there. So today, when I was about to have breakfast, I noticed that the milk had expired just yesterday and decided against consuming it today fearing the worst since I could already get the smell of spoiled milk. I advised my roommates to consume it at their discretion - I'd have thrown it myself, but it's not just my decision to make you see - we all share our groceries at home. So, that got me thinking - how do they all know when milk will actually expire? How can processed foods have expiry dates? That led me to writing this blog on the current global trends of the food processing industry.
The food processing industry is a major and a very mature sector (if you'd like to call that) that is experiencing a very turbulent period due to the growing demands for food safety, food insecurity and consumer demand for high quality and sustainability - the economic impact of getting food safety wrong is significant if food supply chains are incorrectly assessed and risk mitigation is absent - even a small impact on a supply chain can have a large economic impact. The processed food industries are valued at $2 trillion globally and consist of ~400,000 businesses. It is estimated by CDC (Center for Disease Control and Prevention) that every year, 48 million Americans fall sick, 128k are hospitalized as a result of food poisoning and hygiene issues and 3000 die - the cost to US' economy is ~$80 billion every year! Food processing is also impacted by a ton of external factors like climate change, economic trends, demographics shifts, emerging power markets, new trade partnerships and world population growth predictions. Today's food supply chain is more globalized, longer and far more complex than ever before - processed foods are dependent on longer supply chains with growing imports and exports thereby leading to greater challenges to assuring food safety.
In many countries, the food processing industry is a major contributor to health of the national economy - the sector is impacted by both the local economy where it manufactures as well as the global economy in terms of food logistics and import/export agreements with nations. According to the European Food and Drink industry, there are three major production regions worldwide - EU (44% turnover), USA(20% turnover) and China (19% turnover). The turnover of EU food and drink processing industry alone is greater than USA and China combined - this is expected to change in the next few decades. In order to feed the growing population, predicted to reach 9.3 billion by 2050, agricultural production needs to grow by 70% and nearly 100% in fast growing economies like India - where by 2030, India will represent 1/3 of the Asian population and almost 1 every 6th person in the world would be an Indian - by 2050, India, China, Indonesia, Pakistan and the Philippines will represent ~60% of the world population - two thirds of the world population will be living in cities thereby increasing the demand for processed foods and meat protein - in Asia alone, protein consumption is expected to grow by 128% as a result of urbanization! There is now a slight shift in economic power to the E7 (Brazil, Russia, India, China, Mexico, Indonesia, Turkey) and they are expected to overtake the G7(Canada, France, Germany, Italy, Japan, UK, US) in terms of size and purchasing power. The growth in demand and high growth of both exports and imports in emerging markets is making food safety and hygiene in this sector a priority - these emerging markets will drive the global growth in demand and will share most of the import/ exports with manufacturing and processing shifting to these countries owing to a growing customer base. There is also hope that 65% of the world's middle class will be living in the Asia-Pacific region by 2030 - their income will drive the demand for manufactured food products.
To truly ensure food safety, it is no longer enough to mitigate risk in the primary processing and manufacturing unit - businesses need to assess levels of risk along the entire supply chain - from end to end. The increased cost of raw material will impact cost of damages in case of pest infestation and this places a heightened need on the business to take action recommendations to prevent, reduce and control pest infestations at pace. The increasing M&A (merger and acquisition) activities along with continuing consolidation of the market have led to many cost savings measures in order to reduce revenue and protect material supply in-house. The improved distribution processes and supplier assurance to reduce fraud threat and the threat of terrorism across the supply chain (like assuring ingredient authenticity) as a result of supply chain optimization/ vulnerability is a macro-factor affecting food security. An increase in the price of water and ingredients due to drought and climate changes and emerging food safety risks - like the food-borne virus pathogens like Norovirus, A&E, Hepatitis and Campylobacter - are other macros leading to questionable food safety. With many companies pledging to support environmental responsibility (such as reducing greenhouse emissions, deforestation, soil degradation and other farming practices like slash&burn) as well as social responsibility (support for local communities and global fair-trade initiatives), there is an increased need for the quality of the food to be good enough in order to support these practices and meet appropriate budgets. Constantly increasing the number of regulations, making the regulations tighter and stricter and forcing suppliers to improve safety from the start (at the farming stage) of the supply chain will surely help. The new FSMA bill requires the FDA to inspect all facilities exporting to the US to ensure compliance and follow GFSI and Codex Alimentarius recommendations.
In addition to all these trends which are predicted to affect demand, productivity and the cost of raw commodities, consumers, customers and legislators will require even greater transparency than ever before for food security and quality. The demand for clarity of where food originates, and a growing trend for health, sustainability and ethical production will also affect the evolution of the food processing sector. Pest control features notably in PRPs (pre-requisite programmes) for food manufacture as well as high concerns over the main pest challenges facing food processors from rodents, flying insects, SPIs and cockroaches will become increasingly important for manufacturers to partner with a trusted and accredited pest control supplier to mitigate risk from pests, ensuring audit compliance. The consequences of poor hygiene can be dire for a business and will include non-compliance, breach of safety regulations, product recalls and of course, food poisoning - partnership with suppliers such as EN16636 and BRC AIB are critical - thus, make sure you always keep a tab on the expiry date of a product - they are often times real and can lead to detrimental effects on your body and mind!
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