If we are what we eat, what will we eat in the future?

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The past 50 years have seen, at least in the Western world, the development of the consumption society. The emphasis has been on consuming always more, by having an apparently unlimited quantity of increasingly cheaper consumption goods available. This trend happened in the agriculture and food sectors just as well, and followed a rather simple patter, actually. Mass consumption has been coupled to mass production, thanks to intensification, technical and technological progress and, last but not least, marketing.

Junk foodTechnical progress improved yields and productivity, while marketing was aimed at creating more, and new, needs. Our food has become standardized, industrialized, and processed in a wide variety of forms. As the emphasis moved to lifestyle and convenience, which came along with the rise of mass distribution, cheap energy and suburbia, we lost the connection between ourselves, the origin of our food and nature. Food became just things you buy at the supermarket, already packed in plastic and cardboard.

Now, we have come to the realization that this high production of waste, be it packaging material, be it blemished product that do not look good anymore while still perfectly edible, be it the overproduction of manure and its minerals, or be it the massive use of antibiotics and pesticides is not sustainable. Of course, much progress has already done to reduce this waste and there is a growing trend towards organic and traceable, but at this stage it not clear yet whether this is a true change in our behavior or whether it has more to do with a social status and marketing issue.

However, what the current situation might be, the fact that we understand that we cannot keep on intensifying and wasting the way we did, will inevitably bring a more fundamental change in how we consume in the future.

Some people predict such changes as the astronaut diet made out of pills, the use of a computer to tell us what and how much of it we should eat based on our activity level, or the tissue culture to replace meat, and many other scenarios. Will any of those ever happen? Who knows?

Personally, I believe that food as a very strong psychological connotation. We associate food with experiences and, although there are differences between cultures, that emotional bond will stay.

Clearly, the consumption society with all its excesses is coming to its end, and maybe the current economic crisis, which also originated in the excess of having it all at any cost, could very well be the turning point.

The next evolution is probably going to be a balanced approach between consumption, which we need to some extent, and the necessity of preserving what keeps us alive. There will be different graduations of this balance between geographic regions, but sustainability is the only way forward, as I mentioned in my previous article (Sustainability: as natural as balance).

Intensification is showing its limitations, waste of manure and of packaging are also hitting a wall, energy is getting more expensive and makes the production and the transport of food more expensive, too. This will reshape how we want to consume our food, how and where it is produced, how it is presented to us.

Cattle feedlotWe still are in a society where some people get obese by eating lots of food as quickly as they can, while they have less physical activity than the previous generations, thanks to automation. That food is produced on intensive farms and feedlots where the animals grow and fatten as quickly as possible, as they eat lots of food, while not having much physical activity. Similarly, in our society meat producers use hormones to boost growth and carcass quality, while body builders and sport professionals use steroids and growth hormone to boost their performance. Interesting similarities, don’t you think? We are indeed what we eat.

So, in a conservation society, should we expect the farms to be led by the need to preserve? This almost sounds like the farms we had at the beginning of the twentieth century. I think that there will be some of it, but the efficiency of production as well as the efficiency of preserving the environment will be much better, thanks to new technologies. We will have high yields, and at the same time, we will have highly efficient systems to use water, to recycle waste and preserve the fertility of our soils and the balance of our oceans.

Copyright 2009 The Happy Future Group Consulting Ltd.

An example of profitable sustainable aquaculture

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Here is an article (Sustainable Aquaculture: Net Profits) about a fish farm in Andalusia, Spain, which has a different angle than industrial intensive fish farms.

It refers to a number of arguments, such as feces contamination and lower densities, that I had mentioned in a previous article (The lessons of intensive animal husbandry to aquaculture). It also illustrates what I presented in Value chains are a great way to develop a niche, as they market their fish as the pata negra of sea bass at a premium price.

Of course, this farm is an example showing a very specific situation in a very specific environment, and providing seafood to the world population might require more intensive systems. Moreover, not everyone can afford to buy the pata negra category of food.

The PR and the reality about earth-friendly production

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On Earth Day, Meat & Livestock Australia unveiled its campaign about the eart-friendly character of their production (see the article).

One can wonder if this concept is more about PR and rethoric than it is about true higher standards. Hopefully it is, but since there is quite a bit of space in the production areas, planting a few trees and leaving areas for wildlife habitat does not really seem like a particularly challenging task. Unless the impact on the environment can be monitored and tangible results can be shown over time, this could just be no more than a marketing approach to ask a few pennies for their meat without changing the cost structure. The market will decide.

Copyright 2009 The Happy Future Group Consulting Ltd.

Canada’s meat, grain sectors eye EU trade

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This is an interesting article, that shows that when you want to be market-driven, opportunities will come your way.

Here is the story of Canadian beef that might be sold in the EU, if the producers are willing to change their production system (by going hormone-free). While this means higher production cost, the sales price that they get makes them actually make a higher profit margin.

Story at http://www.nationalpost.com/related/topics/story.html?id=1658785

Sustainability: As Natural As Balance

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With the increasing awareness about climate change and our endangered environment, sustainability has become a widespread concept through all industries and the food value chains have embraced it like everyone else.

Yet, I do not quite understand why sustainability seems to be such a “revelation”, or even almost a revolutionary idea. Sustainability is the way that our societies have lived for thousands of years, probably because scarcity of goods made conserving and recycling a necessity of survival. Only over the last 50 years or so have we seemed to forget about it, because of our consuming frenzy and the abundance of goods that we thought to be about infinite.

To put the importance, and the obvious need for sustainability, let’s just look at its definition. What is not sustainable disappears. There is no need for any further philosophical or political discussion. Survival can (note that I only say can) come only from sustainability. All processes in nature that deal with life are all about recycling of organic matter in one form or another, and about balance. If the environment is favorable for a particular species, you will see this species thrive and its population grow quite strongly, to the point that it exceeds its abilities to provide for itself in its original ecosystem. Then, it starts to use more and other resources that nature can replace at the natural pace and this always results in a strong reduction of the population, as the weakest cannot find food and perish, or as the population density helps the spreading of diseases much faster than it would otherwise. Does this sound somehow familiar?

The soil that feeds usThere are many discussions in scientific, economic and political circles about whether we have reached such a stage either regarding pandemics or regarding food supplies. The specter of pandemics recently raised its head with the “swine flu” originating from Mexico. Last year, there were severe disruptions of food supplies in some parts of the world, not as much as the result of an actual shortage, but as the result of prices skyrocketing and fears that food would run out.

Are we about to run out of food? Malthus was warning about such a risk in the early nineteenth century, but since then, the world population has increased far further than he estimated was possible. Today, we probably are not in that dire a situation, yet the main food supply issue is more one of distribution between geographic regions. Some parts of the world are underfed while others die of all sorts of ailments related to overfeeding. This is more a matter of politics than purely of agricultural (including seafood) potential.

Sustainability is about allowing nature to do its work at its own pace. This is all about staying in balance and keeping natural cycles complete their courses. Since you cannot live without eating much more than 2 months, you cannot live without drinking for much more than 2 days and you cannot live without breathing for much more than 2 minutes, these cycles can be reduced to just a few critical areas for life:

  1. The cycle of air, necessary to remove, or to help nature remove the contaminants, so that air remains breathable.
  2. The cycle of water, necessary to remove, or to help nature remove, the contaminants that can make it undrinkable.
  3. The cycle of soils, necessary to preserve the fertility of the soils, and thus allow a continuous agricultural/livestock production to feed people.

Agricultural challenges aheadThis is why, with a growing human population, agriculture and food production at large, managed in a sustainable manner, will become increasingly strategic in the future, and sensible management of water resources will be a key factor for the success of agriculture as well.

Copyright 2009 The Happy Future Group Consulting Ltd.

The consumer must be the focus point of value chains

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The shopping cart: your ultimate target!Regardless which link in the value chain you represent, it is essential to always consider the “big picture”. In this picture, a key element is the end of the chain: the consumer.

As the final user, the consumer will always drive the activities and the profitability of the whole value chain. Although the interaction is left over to the retail sector, the consumer’s quality requirements will trickle down along all the links of the chain. If I take the example of meat for instance, what the consumer wants will have implications all the way back to genetics, and breeding companies know how critical it is for their survival to be able to anticipate these needs, as choices have to be made several years in advance. If you are a breeder, your end product is the consumer product, not just the animal that you produce. If you are a feed company, you do not simply produce feed for the farmer, you are an important element in the acceptance (or rejection) of your direct customer’s product. Your feed becomes eventually the consumer’s choice.

Understanding the consumer is what makes successful value chains, and there is very little acceptable concession from that statement. Many companies fail because they do not listen or understand the consumer market. Pretending to do so, with help from new product development, sleek communication or fancy marketing concepts may help for a while, but it will not stand the test of the consumer. This is why commodities always sell at market price: they do not represent anything to the consumer; therefore, the only differentiation with your competitor’s commodity is the price.

Your product will flow towards the consumer market, and your information must originate from there as well. When building a value chain, always spend time understanding the final link, because it is the strongest and most powerful link!

Copyright 2009 The Happy Future Group Consulting Ltd.

Animal feed: Innovation is the way to add value

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Animal feed is one of the main costs in animal production. Therefore, any performance improvement that will come from the feed or from nutrition gives a competitive advantage.
Animal feedAs such, a feed mill is a rather simple process that feed producers know and master. To put it in simple terms, the recipe is prepared in a big kitchen blender. As a very standardized industrial process, the focus, for a given quality specification is to produce at the lowest cost possible. So, has feed become a commodity or are there ways of offering added value to farmers?
You can look at this at two levels: the feed itself and its usage.
Feed manufacturing itself can be incorporated in the production chain in different ways that will all have the same purpose: cutting cost. The feed company can be independent and market its own feed, or it can just produce as toll milling for a farmer or processing group, as this is already the case.
However, the true added value lies somewhere else: innovation. This plays already today and will increasingly be the strategic area of the future for feed companies. Innovation will continue to cover many areas, from biology, nutrition, to feed technology with the purposes of further improving feed efficiency, and provide raw materials that are more efficient.
In an age where availability of raw materials will become scarce, because of the competition between animal nutrition, human nutrition and possibly demand for biofuels, everything that will help saving and recycling resources will win. To achieve this, we will see new techniques to increase the digestibility of feed, to reduce the feed conversion ratio and create less manure, as well as improvement of the texture and other physical qualities of the feeds. We will see further innovations in the feed composition in order to have the animal use most of it, and for instance the use of enzymes will increase further. Other developments, such as a promising sesame seed extract that can help replicate omega-3 fatty acids in fish feed, can help reduce the dependence on scarce (and expensive) fish oil, and offer substitution possibilities with more types of vegetal oil. However, in this case fish would compete with other farm animals and humans for those oils, making them more expensive in the end. There is also the development of algae as a feedstuffs for farm animals. If successful will such algae be produced in ponds on in the sea, or will it  remain an incubator-based production? Who knows? But expect many new ideas to come to the market, as the fight for resources will become fiercer in the future.
Companies that will possess the latest scientific and technical knowledge, combined with a strong innovative capacity and the talent to locate and purchase the very best mix of raw materials will in fact own intellectual property. Nothing of the above is new, but the future changes will have more to do with the allocation of the different activities in the feed value chain itself. This intellectual property is what they might need to sell in the future, instead of a feed that customers do not always perceive as a differentiated product. Feed and nutrition might become two distinct products and maybe even distinct businesses. Could feed mills become franchises of nutrition and feed technology centers?

Copyright 2009 The Happy Future Group Consulting Ltd.

The lessons of intensive animal husbandry to aquaculture

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egyptian farmingThe domestication of animals for food production started thousands of years ago, and has gone through a slow evolution since then. In the last 50 years, we have intensified productions systems to a very high degree. Aquaculture, although not unusual in ancient times, has really experienced an economic boom only rather recently, and future growth predictions are quite optimistic.

The development of intensive animal husbandry has helped provide people with high nutritional value  products, and it also offered the possibilities to farmers to have a reasonable source of income. On the other side, it has brought a number of problems, many of which have not been solved and this has resulted in pressure to reduce the level of intensification.

chicken farmWith high densities of animal in some regions, animal husbandry has had to deal with a number of health issues, such as not long ago avian flu and swine fever. The presence of large number of animals in limited areas has increased the “disease pressure” on farms and regions, making epizooties quite devastating, considering the amount of culling that health prevention measures require. This always takes a heavy economic toll, and not only on farmers. This has forced many countries to review their policies about intensive animal husbandry and downsized the sector.

To prevent diseases and mortality, intensive animal husbandry has made a widespread use of antibiotics, which also appeared to promote animal growth. Unfortunately, over time it has appeared that these antibiotics found their way into our bodies and ultimately into our drinking water reserves. The main threat that has arisen from the massive use of antibiotics is the emergence of bacteria resistance to these antibiotics, with the potential risk of making them ineffective, should bacteria become resistant to all of them. The result of this would be to bring us back to the pre-penicillin era with all the consequences that we know. Many countries have now addressed the problems surrounding the use of antibiotics and restricted their use to curative purposes.

Another strong impact on the environment has been the manure surpluses in intensive regions. Next to the odor problem, the excessive manure production has resulted in heavy pollution of the soil and of water reserves. Phosphates and heavy metals coming from the animal feed endangered the fertility of the soil. More mobile minerals, such as nitrates, have entered our drinking water, making it in many areas unsuitable for pregnant women and infants. Sadly, the intensive regions get in trouble because of a surplus of minerals that originate from raw materials produced in other parts of the world, while on the farms producing the feedstuffs, the minerals are not brought back. They have to be replaced by chemical fertilizers instead of the manure that would originate from the animals, such as in a closed system mixed farm.

Husbandry systems have evolved, too. After years of high degree of confinement, regulations have changed and are still changing to take animal welfare more into account. As examples, I could give the stop on tethering of sows and hen cage ban. I have no doubt that animal welfare will become a growing issue in aquaculture, too.

The use of feed and its constant quest to reduce production costs has brought the industry to use some raw materials that can be questionable. An example of this was meat and bone meal use, after the mad cow disease hit Britain in the mid 1990’s. Next to the possible transmission risks to humans, it has also raised some questions about whether herbivores should consume meat derivates.

Intensive animal husbandry has made meat, dairy and poultry very affordable to most consumers, at least in the Western countries. This has led to a shift in the diet from mainly starch to a much higher proportion of protein and fat. Unfortunately, this shift has had some negative effect on health. Animal products are high value sources of protein and fat, but excessive consumption has negative effects. While an annual consumption of 30 kg of meat per capita would do just fine, most Western countries have passed the level of 100kg. Of course, there are many discussions between the different parties involved about where the truth lies, but there are good indication that a good diet should include more fiber, more produce and less animal protein and fat.

Fish farmTherefore, above, I have tried to sum up the most noticeable results of intensification of land animal production. Clearly, there are lessons to be learned for the “new” aquaculture industry, and by this, I mean the intensive, high investment aquaculture. Most companies involved in this business have been inspired mainly by the evolution-and the success- in the chicken industry. They try to copy and adapt a similar model. Therefore, it is rather predicable that they will have to deal eventually with similar consequences.

Fish farms have very high densities of animals. Even if the area at the sea level is rather limited, each farm goes quite deep, and the biomass they contain would make many chicken farms look like “small” operations. If you add to this that they are very exposed to the natural environment, as the pens are open nets, there is no wonder that they are very exposed to disease and disease spreading. The current situation in the Chilean salmon farming sector facing ISA just shows how sensitive these farms can be to diseases. My expectations is that aquaculture will be confronted to situations as bad as swine fever and avian flu, and they will have to revise their level of intensification, their location (including possible rotation of site with fallowing as a standard procedure). Further, navigation rules will be strengthened to reduce the possibility of cross-contamination from a marine zone to another.

Very likely, the sector will also further sharpen its veterinary procedures and increase their control on prevention and on medication.  About this part, it may seem that feces simply get flushed into the ocean, but that is not that certain. Feces always contain residues of medicines. The volume of feces produced is quite significant on such intensive fish farms and you can be sure that at some point, simply letting them go into the sea will not be allowed anymore. I foresee that fish pens will have feces collection systems in the future and the “manure” will have to find some use.

The feed industry is now diversifying it sources of raw materials to cope with the rising price of fish oil and fish meal, which is the result of higher demand from the fast growing aquaculture. They carry out lots of research to find the right profiles of oil to meet the fish flesh quality requirements (especially omega3) by using vegetal oil, but one can wonder whether this will be a sustainable approach in the long run. Maybe there will be a completely new industry to produce “farmed” fish oil and fish meal to meet the feed industry needs.

Copyright 2009 The Happy Future Group Consulting Ltd.