Our team member Shiva talks about how circular food systems in Asian cities can address the imminent food security risks in the region.
A report aptly titled ‘The Asia Food Challenge’ published jointly by Temasek, Rabobank and PwC anticipates Asian countries to have 250 million more people by 2030, which, they point out, is like adding the equivalent of another Indonesia to the region, but without the corresponding land mass or the resources.
The region will also be home to 45% of the total global population and 65% of the world’s middle-income households. Even more significantly, more than half of these people would have been born after the year 1980 and would tilt the demographic profile in favour of the millennials and Gen Z. Collectively, these young, affluent Asians will demand US$ 8 trillion worth of food every year, a 100% increase over the $4 trillion dollar annual spend now, implying a 7% CAGR over the next decade.
Normally, this type of projected increase in market size and growth rates would have policymakers salivating at the prospect of new jobs, tax revenues and an additional US$ 800 billion in investment dollars. Yet, this is one market boom that they are arguably not looking forward to.
Asian food production and supply cannot meet this steep rise in demand and, unlike in the case of some non-essential goods and services, shortages in food markets can readily cause acute social distress and unrest.
The Asian region is already a significant net importer of food and this reliance on imports will only increase in size and scope. Constraints in availability of arable land and fresh water, coupled with low agricultural productivity, will further amplify the divergence between demand and production. In fact, the report highlights how the total net imports of food in Asia have tripled in just twenty years and yet, almost half a billion people are still classified as undernourished or malnourished! In conclusion, the study points out the large quantum of consistent investment required in technology and supply chains and the boost in productivity and yield needed to adequately feed us Asians.
This report was published before the covid pandemic hit us and may not even have completely considered the additional risks arising out of climate change effects.
The pandemic has now brought this food security risk to Asians forward by a few years and has precipitated a situation where governments, investors and businesses have to take urgent steps to ensure availability and affordability of food.
Given our work in circular economy and cities, I would like to present some ideas on how the principles of circular economy, when applied to food systems in the urban context, can help deliver food security outcomes in Asia.
There are three important circular design principles that are key to the future food system, all of them relatively obvious and self-explanatory and not dissimilar to views expressed in other reports and articles. The principles are:
1. Reverse large-scale agricultural land degradation and ground water depletion by discovering and adopting: (a) Technologies that optimize land and water usage (b) Nature-inspired methodologies that rejuvenate ecosystems (c) Alternative high-grade nutrient sources
2. Completely eliminate food waste along the supply chain, currently estimated to be about 40% of food transported: Build traceability along the chain and also deliver safe and clean food that is also packaged in material that doesn’t choke landfills
3. Recover value from post-consumer food waste and up-cycle into high-value food input factors, linking to point 1c) above.
There is one other important mega-trend, Mass Urbanization, also mentioned in the report cited above, which makes this circular vision for Asian food systems even more compelling. Asia is rapidly urbanizing and is expected to have 17 of the 25 largest city agglomerations in the world, including 3 of the 30 million+ mega-cities. When considered in conjunction with the fact that Asia also has the least available arable land per capita in the world and fast dwindling fresh water supplies, the solution becomes apparent.
Asian cities have no choice but to integrate agriculture and food production at scale and emerge as hubs of new agricultural technologies and innovation. This shift in urban design creates options that can address the challenges described above.
Urban real estate is precious and resulting limitations in availability of physical space for urban farming will spur innovation that dramatically improves agricultural yields for both conventional and alternative nutrients.
Food grown close to consumers can be delivered fresh, with minimal wastage losses and packaging density. Digital supply chains will ensure safety, freshness and sustainability and help leapfrog broken infrastructure that may take decades to build.
Recovery of nutrients from fragmented post-consumer waste sources and the associated reverse logistics will become economically feasible due to geographical proximity and waste loops will be closed.
The hinterlands get time to recover and learn alternative agricultural methods that rejuvenate natural ecosystems rather than deplete them.
Circular and Urban food systems are not only possible, but also feasible with new business models and an obsessive focus on delivering value to new categories of urban consumers.
Our policymakers, innovators, investors and big businesses only have a modest time window of about 5-8 years to kick-start this mega shift. Can we all come together and make this happen?