Investments in food collection, redistribution, and valorisation infrastructure could enable the retention of substantial economic value and the creation of new revenue streams. Each year around the world the 1.6 billion tonnes of food wasted amounts to USD 1 trillion of economic costs. This lost organic matter consists of edible surplus food and inedible by-products, both of which could be transformed from costly burdens to attractive economic opportunities through enhanced collection, redistribution, and valorisation efforts. In fact, food waste reduction has been found to present an annual economic opportunity between USD 155–405 billion by 2030. The edible surplus food could either be redistributed through, for example, food banks, to help improve food security and fight hunger, or processed to create new food products and revenue streams. The latter option could allow food manufacturers to save costs and attract substantial investments. For example, Renewal Mill, a flour-producing venture using the by-products of tofu and soy milk production as inputs, raised USD 2.5 million for a seed round in 2019.
Inedible food by-products, in turn, could be valorised to create inputs for agriculture as well as new materials and bio-energy, depending on the mixture of by-products present in the stream and technologies available for processing. Innovative solutions for inedible food by-product valorisation can create new revenue streams for farmers and food businesses, while providing them with access to new growing markets. For example, with the global compost market projected to grow with a CAGR of 6.8% from 2019 to 2024, reaching USD 9.2 billion by 2024, investments into valorising inedible food by-products to compost could offer attractive economic returns for food producers and companies. In some cases, food by-products are even well-suited to be transformed for material use in the bioeconomy. For example, Ananas Anam produces a leather-like material called Piñatex®, from the by-product of existing agriculture, i.e. pineapple leaves that would otherwise be discarded.
This infrastructure will also play a critical role in unlocking a variety of environmental benefits for the food system. Currently, every year, one-third of all food produced globally is wasted. Moreover, barely any of this waste is retained and valorised; in Europe only 16% of food waste is captured, while globally less than 2% of all valuable nutrients present in urban food waste and by-products get valorised. As a result, the energy and resources used to grow, harvest, transport, and package these wasted goods is also lost, which, when combined with the methane produced from landfilling some of this waste, creates substantial GHG emissions. In fact, food waste has been found to account for approximately 8% of the annual anthropogenic GHG emissions. If, instead, circular solutions were employed to prevent food waste, increase the redistribution of edible food surplus, and increase the valorisation of unavoidable by-products and green waste through composting, 1.7 billion tonnes of CO2 could be saved annually. Furthermore, some of the USD 700 billion in environmental costs caused by the current linear food production system could be avoided by increasing the collection, redistribution, and valorisation of food surplus and inedible by-products. With food waste volumes surging during the pandemic as a result of farmers’ inability to get their produce to the market, the need for circular solutions that capture, redistribute and valorise surplus food and inedible food by-products will become increasingly important for easing the environmental strain of food systems.
Reaping these benefits will require investment in physical infrastructure in low-income countries, such as cold chains that enable the storage, processing, and distribution of edible food. In low-income countries, most of the food loss occurs immediately after the harvesting stage, due to insufficient infrastructure to store or process excess food. In India, for example, deficiencies in cold chain, distribution, and transport infrastructure are hindering industry growth.
The vast lockdowns and significant disruptions to food flows caused by the pandemic, have only compounded these issues. For example, in Africa, the border closures preventing produce transport resulted in mountains of rotting crops in depots. Increasing the availability of cold chain or specific food processing infrastructure could then extend the shelf life of food while addressing the main cause of food waste in these areas. Using freeze-drying infrastructure to process food, for example, allows it to be kept from spoiling before reaching consumers, while also retaining up to 98% of the food’s nutritional value. These solutions are already being trialled on the market as exemplified by the Ugandan fruit and vegetable dehydrator Sparky Dryer that runs on garden waste and extends food shelf life from days to months. However, much more investment is still needed for storage and processing infrastructure to effectively tackle the challenges of edible food surplus.
In high-income countries, infrastructure facilitating the redistribution of edible food surplus will be needed. In contrast to the situation in low-income countries, high-income countries generate the majority of their food waste at the post-consumer stage. A 2011 FAO study found that 95–111 kg of food waste per capita was generated annually by European and North American consumers, while the corresponding number for sub-Saharan African and South/Southeast Asian consumers was a mere 6–11 kg. A lot of this wasted food is still edible, but due to factors, such as confusing labelling or aesthetic issues, these items get unduly discarded. In order to prevent this edible food from going to waste, investments in redistribution systems that allow retailers, restaurants, and consumers to redirect their surplus food, will have to be made. Many examples of such systems that could be widely adopted and further developed already exist, such as the FareShare FoodCloud platform connecting large retailers with surplus food to local charities, the Danish WeFood supermarket selling produce past its sell-by date at strong discounts, and the mobile app Karma showcasing the unsold restaurant meals that consumers can buy at half-price nearby.
Processing infrastructure to collect and valorise discarded inedible food by-products will also be critical. Door-to-door collection systems, for example, may offer attractive opportunities for municipal organic waste valorisation. Though initially more costly, these systems have been found to generate purer and higher quality by-product streams at greater volumes, thereby lowering treatment costs and rejection rates further down the value chain. Greater purity, in turn, can allow for these inedible streams to be utilised for higher value applications, thereby increasing the returns on valorised content. Organic fertilisers that can return valuable nutrients back to soils to help grow new food are one example of a product that can be made from purer inedible by-product streams. For example, Safi Organics helps farmers convert agricultural residues such as rice husks into a fertiliser blend that can improve farmer yield by up to 30%. Alternatively, in some instances these valuable by-product streams can be turned into various bio-based materials, as evidenced by Orange Fiber, a fabric creating company, that uses pure streams of citrus juice by-products (i.e. peels) for the production of their material.
However, to enable the valorisation of these collected streams, investments into processing infrastructure and reverse logistics will be needed at the same time as well. Large structures such as anaerobic digesters that produce biogas and biofertiliser; bio-refineries that create protein feed, biofertilisers and biochemicals; composting facilities that generate valuable compost or biogas; and other innovative processing solutions that use, for example, insects to convert organic waste streams to valuable products, such as AgriProtein, will need to be developed and distributed, ensuring their accessibility so that their benefits may be achieved. At the same time, smaller scale distributed systems that can be used on-site, such as the anaerobic digester Waste Transformer, can also offer attractive solutions for valorisation of smaller localised inedible food by-product and waste streams.
Digital infrastructure, particularly food flow mapping technologies, will play a key role in the emergence of thriving food networks. Currently, very little information is available for consumers about where food comes from, and for producers about where their food ends up. Some initial attempts of food flow mapping have been made, such as the regional efforts under the FAO’s City Regions Food System (CRFS), which tested rapid food flow mapping in seven cities across the world. Similarly, in the US, the first map of the country’s food supply chain was just created in 2019, revealing 9.5 million links between value chain players across the country’s counties. However, with the global nature of the food supply chain, more investments are needed to develop global food flow maps that can help create clarity around the highly complex system. Access to this data will enable much more effective use of resources and can improve system resilience, while the increased transparency around where food comes from (taking into account all the steps of the value chain), will enable consumers to make even more informed decisions about their purchases, as they increasingly wish to. Meanwhile, regenerative food producers can benefit from being more easily recognized as such, thus enabling the streamlining of supply chains to better connect these farmers directly to buyers interested in their produce. Food waste streams can also be more easily identified and potentially even circumvented through mapping, while the ease of redirecting unavoidable waste for redistribution or valorisation can be increased.
Digital technologies will play a major role in enabling this greater traceability, and as such require investments. Blockchain technologies allow for real-time traceability, thereby improving consumer confidence in food safety, a factor of great importance following the pandemic. Internet-of-things solutions, combined with food sensing technologies that automatically capture and report data on the status of food in transport, for example, can also be used to help determine whether unsold food items can be redistributed or ought to be valorised in other ways. While existing examples of these technologies being applied for the food sector are not yet commonplace, innovation in the space is taking place. For example, in September 2020 Farmers Business Network launched GRO Network™, a platform that combines data provided by grain farmers with artificial intelligence to produce a low-carbon grain score, which can then be used by buyers to better inform them about the impact of their sourced goods.
The policy environment is increasingly supportive of investments in food circulation and valorisation. Policymakers everywhere are becoming more aware of the detrimental economic and environmental impacts of food waste, while also starting to see opportunities in its valorisation. As such, numerous initiatives and regulations are, and have been, sprouting up around the world. Japan introduced the Food Waste Recycling Law in 2001 that improved the recycling rates of food-related businesses. In 2017, the Australian government released its National Food Waste Strategy aimed at halving the country’s food waste produced by 2030. Meanwhile, the EU’s Farm to Fork Strategy of 2020 set out to create legally binding targets on food waste reduction for each member state, in order for all member states to achieve their goal of halving per capita food waste by 2030. With more innovations for food waste revalorisation popping up, and a growing concern over the issues surrounding food waste, it is likely policies around this matter will also become more commonplace and potentially more welcomed by citizens in the future.