Sustainability as a driver of innovation in the food industry

Sustainability as a driver of innovation in the food industry

Regions in the Spotlight 12-23 April 2021

Learn more about Fi Global CONNECT Regions in the Spotlight

| L earn more about Fi Global CONNECT

Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Searching for sustainable alternative proteins . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Meat analogues and plant-based proteins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Evaluating the nutritional value of meat analogues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Lab-grown meat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Precision fermentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Do cellular and acellular agriculture hold the answer to producing highly functional and sustainable ingredients? . . . . . . . . . . . . . . . . . . . . . . . . .

10

Gene editing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Perfecting Nature? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Upcycling and the circular economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Creating added value from food by-products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Sustainable sourcing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

16

Cocoa sustainability in practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Operational efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Reducing energy consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Clean energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

Alternative food processing technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Packaging beyond plastic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Greening transport and logistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

22

Is consumers’ perception of sustainability shifting as a result of the Covid-19 outbreak? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Sustainability as a driver of innovation in the food industry

Introduction Food companies face the major challenge of improving sustainability for the sake of the planet, people, and their own long-term viability. From high-tech solutions straight out of sci-fi, to operational over-hauls, to re-configured supply chain governance, in every corner of the food industry innovations for sustainability are seeing the light of day.

With the global population expected to reach 10 billion by 2050 (from 7.6 billion in 2018)1, the industry is grappling with the question of how to ensure sufficient, nutritious food for everyone.

To add to the challenge, the extra mouths must be fed without increasing - or ideally reducing - reliance on fossil fuels and greenhouse gas (GHG) emissions. The food system is responsible an estimated 21-37% of all CO2 emissions (10.8-9.1 billion tonnes of CO2 equivalents per year) from human activities, making it a main contributor to climate change, according to the UN's International Panel on Climate Change.2 The sustainability imperative facing the food sector links to the wider global movement for sustainable development. Together with governments, non-governmental organisations, academics, and other stakeholders, all industries are called upon to contribute to the UN Sustainable Development Goals (SDGs): 17 bold ambitions to turn around the world's fortunes by the year 2030.3 Many of the goals have a strong relation to food, whether explicitly or implicitly - including SDG 2 on no hunger, SDG 3 on good health and well-being, SDG 12 on sustainable production and consumption, SDG 9 on industry, innovation and infrastructure, SDG 13 on climate action, etc.

“Sustainability is the right thing for our businesses, for our society, and for our planet," said Mella Frewen, Director General of trade association FoodDrinkEurope, at the 2019 launch of an orientation paper on sustainable food systems.4 So, what exactly is the food industry doing? Read on for a round-up of innovation in the pipeline - from manufacturers, ingredients companies, research institutes, and other trailblazers.

Sustainable Development Goals

Source: https://sustainabledevelopment.un.org/3

4

| L earn more about Fi Global CONNECT

Searching for the sustainable alternative proteins With livestock-farming responsible for the biggest proportion of GHG emissions in the food chain (18% of all emissions from human activities)5, exploration of alternative protein sources is a major innovation driver.

One avenue is meat analogues that mimic the taste and texture of various different meat cuts, but which are made entirely of vegetable matter, such as pea, soy, mycoprotein, and new entrants like fava beans and micro algae.

Another is actual meat, produced in labs rather than in fields or feedlots. While the technology is viable, the current task is to identify affordable growth media, and ways of scaling up production and supply chains.

Meat analogues and plant-based proteins With livestock rearing responsible for around 18% of carbon emissions caused by human activities, growing numbers of consumers have become 'flexitarian' - that is, reducing meat in their diets. To cater to them, R&D teams around the world have been developing vegan meat analogues that are near impossible to distinguish from animal-derived foods they mimic in terms of taste, texture, and appearance.

A 2019 report by management consultancy AT Kearney predicted that analogues will capture a 25% chunk of the meat market in 2040.6 Among the best-known brands to hit the market so far are the Impossible Burger and the Beyond Burger. Both replicate beef. Wicked Healthy is now marketing Good Catch plant-based tuna (a blend of chickpeas, lentils, soy, fava beans, navy beans, algae and seaweed)7; and UK company THIS recently secured £4.7 million in seed funding to scale up production of its bacon and chicken analogues —mainly from pea and soy protein.8 Getting the meaty texture right is a major preoccupation for developers. Ojah was so determined to mimic the texture of short ribs with its Heppi extruded yellow pea protein, unveiled at Fi Europe in 2019, that it spent 6 years in development. 9 Barcelona-based NovaMeat, meanwhile, claims to have found the answer for plant-based 'beef steak' in 3D printing technology and tissue engineering technologies.10 Another hurdle is masking the off-notes in taste that can occur with plant-based proteins. This can be a long and frustrating process, as the addition of a new ingredient can mask one off-note but exacerbate another. Givaudan is now offering a helping hand with its SmartTools software, based on the results of 2000 sensory evaluations conducted on peas, fava beans, rice, oats, algae, and whey.11 Until recently the plant-based analogue scene has been dominated by soy, pea, and mycoprotein Quorn.

Now, though, there is demand for more diverse plant-based sources with a high protein content and full amino acid profile. Established companies and start-ups are investigating the likes of fava beans12, micro alge 13, Laetiporous mushrooms14, sugar beet foliage15, and Mankai duckweed16, to name but a few.

A Swedish start-up called Mycorena is also preparing to launch a new fungus-based mycoprotein, one of the first challengers to Quorn in Europe.17

Sustainability as a driver of innovation in the food industry | 5

Evaluating the nutritional value of meat analogues Atze Jan van der Goot, Professor in Sustainable Protein Technology at Wageningen University. Prof. van der Goot is also the scientific leader of the Plant Meat Matters research program that aims to develop the next generation meat analogues. He has (co-) authored 140 peer reviewed papers and holds 6 patents.

Professor Atze Jan van der Goot, Sustainable Protein Technology, Wageningen University

Meat alternatives made from pulses are generally more environmentally sustainable than meat, but plant ingredients often are highly processed to maximise protein. Is there a better alternative?

Companies making meat analogues often focus on protein isolates and concentrates as they strive for nutritional equivalency with meat. However, less processing could improve plant-based products’ eco-credentials – and lower protein content may not be such a bad thing from a nutritional standpoint.

According to Professor van der Goot, products with meat alternatives should be really more sustainable than meat, and that’s not really obvious when you look at the type of processing currently being used.

Van der Goot and his team have developed an energy efficient way of producing large pieces of meatlike structures from plant proteins, such as soy and wheat. The process, called shear cell technology, has been used previously to make fibres out of dairy proteins, but he and his team have discovered the mechanisms by which vegetable proteins form structures. This allows for the manufacture of large, fully fibrous meat-like pieces weighing up to seven kilograms.

“What’s very important for the plant-based meat alternatives market is that new innovations that mimic meat are not just small pieces or pieces stuck together,” he said.18 However, in the course of this project, Prof. van der Goot was prompted to take a closer look at the sustainability of plant-derived ingredients and realised that there might be more eco-friendly approaches.

6

| L earn more about Fi Global CONNECT

“…I started to question why it was more sustainable. I found there was really room for improvement,” he said. “…What we clearly see is if you start eating beans and peas and legumes directly, you make a big difference. It’s possible to just make a flour from those materials instead of a previously processed isolate or concentrate…We should try to limit that purification as much as possible.”19 Many in the industry would argue that producing protein isolates and concentrates from pulses helps to improve the nutritional value of meat analogues but van der Goot says this is not necessarily the case. In fact, he says overconsumption of protein could be considered a net loss in the food chain.

“A deviation from the nutritional profile of meat is not necessarily bad. It could even be better,”20 he said, adding that western populations tend to need more dietary fibre – and nearly always consume enough protein, including among vegetarians and vegans. “We have to realise that the products we are making help consumers replace part of their meat consumption,” he said.21

Visit Fi Global Insights to read the full interview with Professor Atze Jan van der Goot bit.ly/sustainability-of-meat-alternatives

Sustainability as a driver of innovation in the food industry | 7

Lab-grown meat While analogues may satisfy some consumers, the die-hard meat-eating habits of others have led to a race-to-market for meats produced via non-agricultural methods.

The first prototype burger made from lab-grown animal cells was unveiled in 2013 by Professor Mark Post, later chief scientific officer of Mosa Meats and, at the time, it seemed more science fiction than viable solution — not least because it cost €250,000 to produce. 22 But Mosa's announcement sounded the starting gun in a race to bring the first lab-grown (also known as cultured or 'clean') meat to market.

The process involves extracting cells from an animal (non-invasively) and plying them with nutrients and growth factors (sugars, salts, pH buffers, amino acids, micronutrients and proteins). This causes the cells to proliferate and form muscle tissue, fat, or connective tissue.

As well as entailing a massive reduction in carbon footprint of meat production, cultured meats contain no antibiotics, helping to reduce antibiotic resistance and food borne disease, and the levels of fat and cholesterol can be controlled to make meat-eating healthier.

Like Mosa Meat, many of the start-ups are working on beef.

Israel’s Aleph Farms, which has produced a prototype minute steak, is focusing on beef first because cattle are the most environmentally problematic livestock.23 Others are betting on early differentiation: California-based Memphis Meats is working on poultry; Dutch-based Meatable 24 and the UK's Higher Steaks 25 are both concentrating on pork; and Singapore's Shiok Meats 26 has opted for cultured crustaceans.

Despite the international activity and multiple millions of investment from venture capitalists and traditional meat companies, like Cargill and Tyson Foods, the most ambitious estimates put lab-grown meat on dinner plates in about two years' time. Others maintain five years is more realistic. The main technical challenges are finding affordable growth media and production and supply chain scale-up. Moreover, cultured meat has not received regulatory approval in any market to date; in Europe, companies will have to compile and submit a dossier under the novel foods regulation.

Once they get there, the rewards will be considerable. The AT Kearney report predicted that cultured meat will outpace even meat analogues by 2040, with a 35% market share. 27

8

| L earn more about Fi Global CONNECT

Precision fermentation To improve sustainability in the food ingredients sector, there is an urgent need for alternative, nonagricultural sources of compounds that serve a functional role in formulations, such as emulsifiers, stabilisers, colourants, and flavouring compounds.

'Precision fermentation' is a process for producing complex organic molecules, such as proteins, through programming of micro-organisms. According to a 2020 report released by think tank ReThinkX28 it has the potential to seriously disrupt the dairy and livestock sectors within the next 10 years by enabling cheaper food ingredients that are functionally equivalent to the real thing.

While precision fermentation is not new per se, biotech advances have meant the per kilo cost of production has reduced massively over the last two decades, from US$1 million in 2000 to $100 today.

And in 10 more years ReThinkx predicts that casein and whey produced via fermentation will be 5 times cheaper than their dairy-derived counterparts.28 One particularly intriguing fermentation technology has been developed by VTT Technical Research Centre of Finland and spun out into a start-up called Solar Foods. Its flagship ingredient, Solein, is produced using water, electricity and CO2 to feed a secret strain of bacteria found in Finland. The protein is dried to powder containing 65-75% protein, 10-20% carbohydrates, 4-10% fats, and 4-10% minerals. 29 The innovation has been dubbed 'post-photosynthetic food production', since it does not require sunlight.

Neither does it need land or irrigation, making it greener than plant-based protein production. Solein is also self-sufficient; it needs no carbohydrates, protein and fats to grow, unlike cultured animal cells.

In September 2019, Solar Foods entered a strategic collaboration with Finnish manufacturer Fazer Foods to research the ingredients' use in different food applications. Again, though, we won't be dining on Solein until at least 2021, since the novel foods dossier has yet to be completed.30 Solein won't be lonely in the marketplace, either. In November 2019, Californian company Kiverdi heralded the development of a meat-like product made from Air Protein, an ingredient produced using a similar process. Kiverdi say:

"The process to create [Air Protein] uses elements found in the air and is combined with water and mineral nutrients. It uses renewable energy and a probiotic production process to convert the elements into a nutrient-rich protein with the same amino acid profile as an animal protein and packed with crucial B vitamins, which are often deficient in a vegan diet." 31

Sustainability as a driver of innovation in the food industry | 9

Do cellular and acellular agriculture hold the answer to producing sustainable ingredients?

Emilia Nordlund, D.Sc. (Tech.) heads VTT’s Food Solutions team, targeting more unrefined plant-based foods and developing new product and processing concepts for an efficient and sustainable future food chain.

Emilia Nordlund, D.Sc. (Tech.), Head of VTT Food Solutions

“Cellular agriculture refers to the use of single cell organisms or cell cultures for food production. People have usually heard of animal cell propagation techniques known more commonly as cultured or clean meat; however, cellular agriculture also covers other cell-based or microbial food production systems.

Take for instance the use of cultured plant cells as fresh food, or the use of microbial organisms for single cell protein production and recombination of protein technologies. By fermentation, these techniques enable large-scale production of functional proteins, like animal proteins, in heterologous expression systems.”

“When the cells are used for food, like single cell proteins and plant cells, we can talk about cell-based food ingredients. On the other hand, when we harness the microbes to produce a certain protein or component and purify it from the cell mass and culture media, we talk about acellular food ingredients.”

“Quorn and spirulina are existing examples of cellular food products on the market.

Enzymes used in food manufacturing as processing aides, are typical acellular products that have long been used by the food industry.”

“When we harness microbes and vertically scalable bioreactors for food use, we can clearly decrease the carbon footprint and land use of the food production.

If we can provide alternatives for meat and animal-based products, the environmental benefits can be significant. For ethical reasons, giving up animal farming should be our final target. Cellular agriculture can also provide safer and more controllable production of food, as we are not dependent on climate and soil quality, and do not need to use antibiotics!”

Visit Fi Global Insights to read the full interview with Emilia Nordlund bit.ly/cellular-acellular-agriculture

10 | L earn more about Fi Global CONNECT

Gene editing Another technology with the potential to boost sustainability in the food sector is CRISPR gene editing via the cas-9 enzyme. CRISPR-cas9 allows scientists to quickly and cheaply edit existing genes within an organisms using DNA clusters (Clustered Regularly Interspaced Short Palindromic Repeats). Unlike genetic modification, it does not involve splicing genes from one organism into another. 32 One food company that is working with CRISPR-cas9 technology is Israeli start-up Equinom, which attracted investment from agri-chemical giant BASF in late 2019. Equinom specialises in breeding crops with desirable properties for food ingredients, including increasing protein levels in soybeans, peas, and other legumes, thereby lowering their price point as meat alternatives. 33 Another is Michroma, which uses CRISPR-cas9 for the production of novel compound food colourings from filamentous fungi. The company originally sought to produce a red colour as an alternative to cochineal from beetles but is now investigating a spectrum of other hues with lower carbon, water, and land-use footprints than plant-based colourings. 34 And Corteva Agriscience, the agriculture division of DowDuPont, has used CRISPR-cas9 to develop a new variety of waxy corn, used as a thickener and stabiliser. 35 A second gene editing technique is known as TALEN (transcription activator-like effector nucleases) - that is, restriction enzymes that can be engineered to remove certain DNA sequences within cells. TALEN is being used to manipulate crops for better nutrition and reduced allergens. For instance, Calyxt has used it to turn off the trans fat genes in soy beans, giving them a healthier fat profile. It may well find uses to boost sustainability in the future. 36 Development teams will be hoping that European consumers will be more receptive to CRSIPR and TALEN than they have been to genetic modification. That is by no means a given, however, as EU regulators have decreed that gene editing falls under GM regulations, which require clear labelling on products containing over 0.9% GMO ingredients. 37

Sustainability as a driver of innovation in the food industry | 11

Perfecting Nature?

Dennis Eriksson holds a PhD in Genetics and Plant Breeding, is a Researcher at the Swedish University of Agricultural Sciences (SLU), Chair of COST Action PlantEd (CA18111), and Executive Manager of the Plant Genetic Resources International Platform (PGRIP).

Dennis Eriksson, Researcher, SLU, Chair of COST Action PlantEd (CA18111), Executive Manager, Plant Genetic Resources International Platform (PGRIP)

“An improvement in our capacity to develop good crops (that are environmentally friendly, nutritious, and high-yielding) is ONE of many ways we need to work to move our society towards sustainability. People have been breeding crops for at least 10-12 millennia, but until the 20th century it was a very slow and inefficient process and, as a result, the crops were very poor. We must never forget that plant breeding feeds people. Without science-based and efficient plant breeding, so many more people would be starving in our world. The latest technological advancements add to the breeders´ toolbox and allows them to work more efficiently. The breeders could of course limit themselves to only the older technologies, such as cross breeding and radiation-induced mutagenesis, but progress would be slower, and agriculture would keep its dependence on agrochemical inputs such as pesticides. Having said that, I need to repeat that breeding is of course only one of many necessary things we need to work with to achieve a more sustainable agriculture.”

“There is, and has always been, a great symbiosis between fundamental plant research and plant breeding. Research leads to new discoveries and more knowledge about genetic and biochemical pathways in the plant cells – and this knowledge is being applied by breeders who use it to improve the way the crops grow in the field. To name but a few examples, researchers are currently developing gluten-free wheat that is suitable for people with coeliac disease, and purple tomato with high levels of very healthy anthocyanins. Give it a few more years, and a more innovation-friendly atmosphere in the EU, and we may find these on the market.”

Visit Fi Global Insights to read the full interview with Dennis Eriksson bit.ly/plant-bred-future

12 | L earn more about Fi Global CONNECT

Upcycling and the circular economy According to the United Nations' Food and Agriculture Organization, one third of the food that is produced for human consumption is wasted, with vast quantities lost at every stage in the supply chain.38 Not only is this a tremendous waste of resources, but organic material that is not properly handled can cause pollution, greenhouse gas emissions, and constitute a public health hazard.

In a bid to reduce waste from across the food system, innovators are exploring industrial by-products as sources of food ingredients.

Coffee grounds are among the by-products that have proven most interesting to date. Caffelnk, a finalist in the Start-up Innovation Challenge at Fi Europe 2019, has found a way to extract brown, ocher, and beige colourants from grounds.39 Danish start-up Kaffe Bueno, meanwhile, upcycles spent coffee grounds for use as nutritious ingredients for wellness products. 40 The Coffee Cherry Co also uses coffee by-products, but in this case the skins of the coffee fruit, which it buys from farmers, dries, mills, and wells as a high-fibre antioxidant for bakery, beverage and confectionery applications. As well as reducing waste, this has social sustainability benefits by bringing a new income stream to farmers.41 De-fatted seeds, the by-product of oil production, are another material of interest. Planetarians' patentpending technology uses thermomechanical engineering to turn de-fatted sunflower seeds into 50% protein concentrate and 35% protein flour — and it is experimenting with other waste materials, such as coffee grounds, orange peel, fruit and nut pulp.42 Linnolat, a start-up that was accepted into the European Institute of Innovation and Technology (EIT) Food accelerator in 2019, uses defatted hazelnuts, coconuts, and sesame seeds as a vegan alternative to milk and white chocolate (both of which require considerable quantities of milk protein). 43 Chocolate makers may also benefit from innovations that use cocoa shells and pulp as a sweetener. In early 2020 Ireland's Healy Group announced PrimaFi Cocoa, a micronised cocoa fibre that can reduce sugar by up to 45%. 44 Spent brewers' yeast is the starting material for New York-based Rise Products, which developed a patentpending technology to create nutritious bakery ingredients.45 Dutch start-up FUMI Ingredients uses spent yeast for a very different purpose, as the source of an egg white substitute with impressive foaming and binding properties.46 It is not only innovative start-ups that are exploiting the potential of by-products. Established companies, too, are in on the action.

Sustainability as a driver of innovation in the food industry | 13

In January 2020 the EU Smart Protein project began at the School of Food and Nutritional Science at University of Cork, involving 33 industry partners (including Barilla, AB InBev, ProVeg International). Funded to the tune of €8.2 million under Horizon 2020, with an additional €1 million coming from industry, the project is exploring how the by-products produced during pasta, bread and beer production can be tapped to make microbial biomass proteins for plant-based meats, fish, sea-food, cheese, infant formula, dairy, baked goods.47 While upcycling existing waste streams is contributing to sustainability in the food sector, some companies are avoiding waste creation altogether by finding efficient ways to extract the maximum of value out of raw materials. CP Kelco teamed up with researchers from the Technical University of Denmark to extract protein from seaweed biomass, in addition to the carrageenan that is the mainstay of its business.48 VTT Technical Research Centre of Finland, meanwhile, is experimenting with oat fractionation technologies to produce oat fibre, proteins, and carbohydrates, all from the same grain.49

Bringing the global food and health ingredients industry together digitally Bringing the global food and health ingredients industry together digitally

Regions in the Spotlight 12-23 April 2021 Regions in the Spotlight 12-23 April 2021 Health Ingredients in the Spotlight 14-18 June 2021 Health Ingredients in the Spotlight 14-18 June 2021 Plant-Based Ingredients in the Spotlight 13-17 September 2021 Plant-Based Ingredients in the Spotlight 13-17 September 2021

14 | L earn more about Fi Global CONNECT

Creating added-value from food by-products Dr. Delphine Huc-Mathis is the Assistant Professor at the Paris Institute of Technology for Life, Food and Environmental Sciences. Her research activities are focused on the structure and physico-chemical properties of interfaces, in multiphasic systems.

For example, experiencing how physical treatment such as homogenization can be applied for structuring gels.

Dr. Delphine Huc-Mathis, Assistant Professor, Paris Institute of Technology for Life, Food and Environmental Sciences

“Apple pomace is one source we are studying, to generate added-value from food by-products for food and cosmetics applications. A first objective is thus ensuring a virtuous circle based on this renewable raw material. A second objective is to understand this ‘new’ ingredient. Using apple pomace as a raw, unmodified material instead of isolates or pure extracts is a bold choice that goes against the grain. We are convinced that if we can master these materials, it will open the door to many applications.”

“The benefits for the food sector are two-fold. Firstly, by valorising food byproducts, manufacturers are creating added-value, which could lead to a new chain of value around what could be new ingredients. Secondly, using raw, unmodified and unfractionated materials as a main stabiliser in emulsions could bring real environmental benefits and some clean label claims. This would help manufacturers meet consumer expectations about natural products. Using food by-products in new products would ensure the establishment of a virtuous circle.”

Visit Fi Global Insights to read the full interview with Dr. Delphine Huc-Mathis bit.ly/added-value-from-food-by-products

Sustainability as a driver of innovation in the food industry | 15

Sustainable sourcing Delivering sustainable ingredients is not just a job for food technologists. Procurement specialists also have a role to play. Over the last decade, many ingredients firms have developed innovative sourcing strategies that are geared towards securing long-term supply of essential inputs, of high quality and at stable prices, via transparent supply chains.

Often this means 'vertical integration' or working directly with producers or cooperatives (sometimes in partnership with trusted local operators or non-governmental organisations), and ensuring producers are fairly paid. But beyond remuneration, they also help ensure producers have the technical expertise and/or equipment to maximise yields, while adhering to sustainable agricultural practices.

For many companies, sustainable sourcing comes with a side order of investment in the wider community, via initiatives to improve social wellbeing, health, education, or infrastructure. In helping ensure farmers' families and communities thrive, they reduce the likelihood of farmers ending their activity and seeking better conditions elsewhere.

16 | L earn more about Fi Global CONNECT

Cocoa sustainability in practice Oliver Nieburg is a market analyst at Lumina Intelligence and has nine years of experience covering the cocoa market as former editor of trade publication ConfectioneryNews.

Oliver Nieburg, Market Analyst, Lumina Intelligence

“Billions have been invested to stimulate sustainability in cocoa in the last 10 years. Alignment among companies and governments has improved, but there is little evidence of a strong contribution to the target indicators of the UN’s 2030 Sustainable Development Goals.”

“Farmer adoption rates for company initiatives are low and average yields per hectare have declined in the two main producing countries. Poverty, child labour, malnutrition and deforestation remain widespread. It comes as farmers feel locked out of decision-making.”

“A cocoa origin claim is a communication on a chocolate package or online product description indicating where the cocoa comes from. It can be a country claim (a single origin claim such as Ecuadorian cocoa), a province claim (e.g.

Amazonas) or a farmer cooperative claim. Chocolate products with such claims attract stronger online consumer engagement, better reviews and star ratings than products using a conventional fair-trade claim. Origin claims also attract a higher retail price.”

“A cocoa origin claim can be a more neutral way to promote cocoa sustainability than a fair-trade claim that positions farmers as groups in need rather than equal business partners.”

“Chocolate brands can drive the premium-end of the ethical chocolate market with mission-led brands tied to a deprived cocoa province. Such brands should engage cocoa farmers to be part of decision-making process. Farmers could decide how premiums from higher retail prices are spent on local infrastructure.

Imagine a chocolate origins line promoting Ashanti (a region in Ghana) where a portion of profits go to fund teacher housing, which has been identified by farmers as a pressing community need to attract quality teachers to the local area.”

Visit Fi Global Insights to read the full interview with Oliver Nieburg bit.ly/Cocoa-sustainability-in-practice

Sustainability as a driver of innovation in the food industry | 17

Operational efficiency Throughout their factory operations, food and beverage companies are employing technological innovations to drive down GHG emissions. The buzz words behind their efforts are reduced energy consumption, increased efficiency, and circularity.

A first imperative for manufacturers is to cut out all excess energy use from their production plants. This means investing in modern equipment, sometimes incorporating artificial intelligence to ensure smooth running and avoid down-time, such as using sensors to tell operators when the kit needs cleaning.

They are also looking to remove coal from their energy mix and replace it with greener, alternative sources like biomass, hydropower, wind and solar energy. Sometimes they can produce their own green energy on-site, for instance by installing solar panels on factor roofs, or building wastewater treatment plants that take a waste side stream from one part of operations and convert it into biomass to power another.

And when they can't produce it themselves, some food companies are investing in energy suppliers to enable them to build and scale up renewable energy infrastructure, such as wind farms in locations whose energy needs are poorly served.

Reducing energy consumption One way to significantly reduce GHG emissions is to reduce energy consumption in factories. This means up-grading equipment to energy efficient models, ensuring that operations run at optimum efficiency, and reducing down-time — both planned and unplanned — to a minimum.

New technologies have been introduced for production plants to be cleaned more quickly, thoroughly, in situ, and at the right moment to maintain productivity and avoid outages. A partnership between the University of Nottingham in the UK and equipment supplier Martec of Whitwell led to development of artificial intelligence sensors embedded in machinery, which inform operatives when a cleaning cycle is needed.50 In a similar vein, in 2018 Coca Cola Europe invested €900,000 in electro chemical activation cleaning at its plant in Ploiești, Romania, resulting in an annual reduction of 2,730 MWh in energy used and a 870 tonne reduction in carbon emissions — as well as savings of 18,000 m3 of water and 100 tonnes of chemicals each year. 51 Another way of reducing energy consumption is to use the waste outputs from one part of operations to power another. For instance, Unilever installed an anaerobic flotation reactor at its Ben & Jerry's factory in the Netherlands, using waste from ice cream production and wastewater from cleaning to create biogas, which is then used in the factory’s GreEnergy project for insulating water during the production process.52 A similar installation at Mars' factory in Veghel, the Netherlands, results in in a reduction of 25,4 TJ in energy consumption each year and 1.5 kton of carbon emissions.53

18 | L earn more about Fi Global CONNECT

At Kellogg's UK factories in Manchester and Wrexham, energy is recovered from the wastewater treatment systems and exhaust systems on cookers respectively; in both cases it is used to (pre) heat water, resulting in combined energy reductions of over 3,700 MWh.54

Clean energy Food manufacturers can also slash their carbon emissions by removing coal from their energy mix and replacing it with greener alternatives, such as biomass, hydropower, wind and solar energy. This calls for investment in renewable energy infrastructures in areas where access to electricity is limited and working with energy suppliers to enable scale up of technological innovations.

For example Unilever, which is aiming at carbon neutrality by 2030, has entered into power purchase agreements (PPAs) with renewable energy producers and purchases national renewable electricity certificates (RECs) in individual countries from a dedicated renewable electricity source. As a result, all its locations in Africa, Asia, Europe, Latin America and North America are powered by 100% renewable grid electricity; and 16 manufacturing sites are completely carbon neutral in their energy use. 55 The energy needs of Mars' 70 production sites in the US are covered by a 25,000 acre wind farm in Texas called Mesquite Creek, with a similar project for its 6 sites in Mexico.56 Similarly, General Mills signed a 15year PPA with Roaring Fork Wind, LLC, a joint venture partnership between Renewable Energy Systems and Steelhead Americas, for 200 megawatts (MW) of its Maverick Creek wind project in central Texas. Together with the company’s previous wind power agreement, General Mills now has energy credits equal to 100% of the electricity used annually at its domestic facilities.57 Kellogg, meanwhile, has conducted a global renewable energy assessment with a third party to determine the technical and financial feasibility of renewable power in each of its markets. Amongst the innovations realised, its plant in Taloja, India has installed solar panels, which are already delivering 10 percent of the facility’s power requirements. 58

Visit Fi Global Insights to read more on: Greener food manufacturing: a round-up of innovations bit.ly/greener-food-manufacturing

Sustainability as a driver of innovation in the food industry | 19

Alternative food processing technologies Professor Anet Režek Jambrak, from the Faculty of Food Technology and Biotechnology at the University of Zagreb, Croatia. Her main area of expertise lies in advanced thermal and nonthermal food processing techniques (ultrasound, microwaves, high pressure processing, pulsed electric fields, plasma, AOP).

Professor Anet Režek Jambrak, Faculty of Food Technology and Biotechnology at the University of Zagreb, Croatia

“The aim of using alternative food processing technologies is to achieve the desired inactivation of microorganisms, reduce energy consumption, optimise time-consuming processes, and satisfy consumer requests. Nowadays, one of the biggest challenges is to scale up the readiness level of these novel technologies to an industrial level. The food industry should also focus on zero-waste processing, waste management and the sustainability of food packaging.”

“While thermal techniques have been used for decades, high-temperature processing can be responsible for the deterioration of nutritive, functional, and organoleptic properties. Therefore, several nonthermal techniques had been evaluated for their potential in food preservation. So far, only high-pressure processing has satisfied requirements in terms of microbial inactivation, when used alone in food preservation. The use of other nonthermal processing techniques is industrially viable only in combination with moderate heating, to ensure the required food preservation effect.”

“Nonthermal technologies are sustainable if we use them to reduce or reuse food waste. It is very important here to perform life cycle assessments (LCAs), to confirm their sustainability. Novel nonthermal and improved thermal processing techniques can offer more efficient energy consumption and quality and impact positively on food quality.”

“At DIL in Germany, the energy balance and LCA of pulsed electric fields and high-pressure processing technologies were recently compared to conventional thermal processing applied to the preservation of tomato and watermelon juices. At the pilot scale, both pulsed electric field and high-pressure processing technologies presented lower energy consumption expressed per litre of juice. At DIL, they are also producing pulsed electric field equipment in pre-treatments of potato to reduce oil consumption, and to speed up the frying process.”

Visit Fi Global Insights to read the full interview with Professor Anet Režek Jambrak https://bit.ly/food-production-sustainability

20 | L earn more about Fi Global CONNECT

Packaging beyond plastic The food and beverage sector's reliance on plastic packaging is acknowledged as problematic, even though it provides the ability to protect products from contamination and degradation throughout the supply chain.

According to the Center for International Environment Law, 99% of plastic is made from chemicals sourced from fossil fuels, and demand for plastic packaging is driving controversial extraction techniques, such as hydraulic fracturing (fracking). Moreover, plastic waste is a massive global problem. Each year, up to 12.7 million tonnes of plastic enters oceans.59 Manufacturers are driving packaging innovations by laying down targets on virgin PET use and promoting circular resource use. For example, PepsiCo's target is to reduce virgin plastic content across its beverage business by 25% by 2025; 60 and Coca Cola aims for every plastic bottle to contain at least 50% recycled plastic by 2030.61 One significant innovation is enhanced recycling, such as the process developed by Ioniqua Technologies that breaks down the components of plastics that would not normally be recycled (such as bottles retrieved from the sea), strips out the impurities from lower grade materials, and reconstructs the remaining, pure components into food grade materials.62 New, compostable alternatives to plastic packaging are also emerging. For example, Italian start-up Qwarzo, the winner of Fi Europe 2019 Startup Innovation Challenge63, created a nanotechnology sol-gel that can be applied to paper to form a thin, flexible, inert layer of silica dioxide that renders it water-proof and grease proof. The material, which is compostable and recyclable, can be used for wrapping or shaped using injection moulding into solid packaging, caps, or even cutlery.64

Source: Fi Europe 2019 Startup Innovation Challenge, interview with Italian start-up Qwarzo

Sustainability as a driver of innovation in the food industry | 21

Greening transport and logistics Transport and logistics can account for a big share of manufacturers' environmental impact because their activities are often dispersed across a large geographical area, to be close to input sources and ensure market coverage.

The UK's Food and Drink Federation has published a 10-point checklist to encourage fleet operators to adopt more sustainable practices.65 These include prioritising transportation by train or ship wherever possible.

General Mills, for example, combines shipments for Green Giant Sweetcorn, Old El Paso, and Nature Valley, all of which are manufactured in south west France or northern Spain, sending them by sea from the Port of Bilbao to Liverpool.66 Other tips from FDF concern reducing the impact of road haulage where it cannot be avoided, such as for small loads and the final stage of a journey. How a vehicle is loaded, how it is driven, and how it is maintained can all make a difference, as can use of modern vehicles that comply with the latest EU emissions standards and run on alternative fuel.

Britvic is one company that set out to green its road fleet, aiming for 10% electric and alternative vehicles by 2020; by 2019 it had already reached 18%, with 30% of new vehicle orders for hybrid vehicles. Average CO2 emissions across Britvic's fleet are now 103g/km.67 Off-site - or rather, between sites - optimising distribution routes contributes to emissions reduction.

Telematics and tracking can recommend the best routes during a journey, while software can preemptively create the shortest connections between goods and customers, saving distance, costs and CO2. Südzucker uses software to optimise distribution between its 25+ factories and refineries, warehouses, and delivery destinations.68 According to a white paper by Coca Cola Europe and Cranfield University, big data, block chain, and the Internet of Things enable tighter operations and resource savings, revolutionizing quality assurance and efficiency.69 For instance, Coca Cola Europe established an Automated Storage and Retrieval Warehouse at its Sidcup site in the UK, resulting in a reduction of 10,000 road miles (16,093 km) per year and 3,800 tonnes of CO2.

22 | L earn more about Fi Global CONNECT

Is consumers’ perception of sustainability shifting as a result of the Covid-19 outbreak?

Julian Mellentin is the founder of New Nutrition Business, expert consultancy services to ingredient and branded product companies on all aspects related to nutrition and health since 1995.

Julian Mellentin, Founder, New Nutrition Business

“Many companies have prioritised sustainability over health and nutrition in recent years. Some wonder whether they can do both sustainability and health. The answer is that you have no choice but to do both – and also to deliver on food hygiene and safety.”

“Consumers will be prioritising health and hygiene for a while and that in the next 12 months is where the focus of your efforts should be. But for the longer term sustainability is an unavoidable must-do and should be equal on your agenda, if not now, then certainly 18 months from now. If today you prioritise it above hygiene and health, you are not aligning yourself with most consumers’ priorities and you may come to regret such a decision.”

“Covid-19 has mostly accelerated trends that were already there. For example, from direct-to-consumer (D2C) business to the growing consumer interest in provenance and more local products and ingredients, this change has been gathering pace since about 2008. Even the biggest companies have embraced it, with giants like Danone marketing products with locally-sourced ingredients, such as its Fruits d’Ici (translation: Fruits from here) yoghurt brand. For many consumers locally-sourced – or some other clear provenance – means sustainable and a ‘provenance’ strategy is one way to deliver sustainability now and also address consumer concerns.”

Sustainability as a driver of innovation in the food industry | 23

“Everyone who cares about the environment wants to see an end to disposable coffee cups – and more people were taking their own refillable mugs to the coffee shop. But in early March, as coronavirus was gaining momentum, Starbucks suspended the use of personal cups and tumblers at its stores around the world to help prevent the spread of coronavirus. And thus we were reminded that safety and protection are two of the functions of consumer goods packaging. Getting rid of it to save the planet may not be as easy as we think. Consumers want less plastic packaging – but they also want to feel secure. For the next 18 months many people (maybe most) will prioritise the second over the first.”

“Many retailers have already taken swift action to eliminate the contamination risks that they and consumers see in self-serve. For example, in the US, Stop & Shop has eliminated all self-serve stations. My Mochi Ice Cream, America’s biggest brand of Japanese-style ice cream, has launched single-serve ice cream balls ‘packaged individually for optimal quality and freshness, while ensuring food safety’. The new plastic, single-serve pack will appear in what was the self-serve freezer, where the company previously retailed unpackaged ice cream balls for consumers to selfselect with tongs.”

Source: https://www.prnewswire.com/news-releases/mymo-mochi-ice-cream-introduces-individual-singleserve-packs-in-retailers-nationwide-301043894.html

“Post-crisis, some retailers and manufacturers may have to think about additional or different protective packaging products. While still keen to lessen the environmental impact of packaging, some consumers will put personal health first.

Rather than do-it-yourself, bring-your-own container programs, we may instead see the application in many categories of containers – just as glass milk bottles have long been used for home delivery reusable - that are supplied by the retailer or the brand-owner, returned by the consumers and sanitised for reuse by the vendor.”

24 | L earn more about Fi Global CONNECT

“A replacement for plastic will need to provide the same security and shelf-life as plastic – while also scoring well on sustainability. In premium markets there has already been a small shift back towards glass (in liquid milk for example) and we can expect that to continue. In the mass market plastics – even single-use plastic cups – with their re-assuring sense of protection will continue to hold sway for some time yet.”

“Perhaps it will be the perfect opportunity for companies to invest in packaging innovation (recycled, biodegradable, plant-based plastic, carton, etc…) since consumers want safety and having a sustainability/novelty angle will be a plus for a segment of consumers.”

“Consumers’ attitude to food safety has changed with the COVID-19 outbreak - playing things safe with familiar brands rather than taking a risk on new things, packaged rather than loose goods. Recently, safety was not an opportunity in developed markets, since consumers simply took is as a ‘given’ – a guaranteed, unthought-of aspect of their food supply – from the 1930s onwards. But in Asia (and particularly China, where there is a long history of food safety scandals, and little faith in domestically produced food) safety was always an important consumer reassurance and selling point.”

“In the West a small but not insignificant percentage of consumers will be paying more attention to safety. Transparency in the supply chain - communicating where you source your ingredients, from, whom you source them, where you make your products – was an existing trend which will become more valuable for consumers.”

Sustainability as a driver of innovation in the food industry | 25

Sources https://population.un.org/wpp/Publications/Files/WPP2019_Highlights.pdf https://www.ipcc.ch/assessment-report/ar5/ 3 https://sustainabledevelopment.un.org/ 4 https://www.fooddrinkeurope.eu/news/press-release/fooddrinkeuropes-orientation-paper-on-sustainable-food-systems/ 5 https://www.ipcc.ch/assessment-report/ar5/ 6 https://www.kearney.com/consumer-retail/article/?/a/when-consumers-go-vegan-how-much-meat-will-be-left-on-the-table-foragribusiness7 https://wickedhealthyfood.com/2019/02/21/launch-of-good-catch-fish-free-tuna/ 8 https://agfundernews.com/this-plant-based-meat-startup-4-7-million-in-seed-funding.html 9 https://www.ojah.eu/wp-content/uploads/2019/11/Press-release-Ojah-BV-announces-the-launch-of-The-World’s-First-Vegan-Ribs.pdf 10 https://www.novameat.com/ 11 https://www.givaudan.com/media/trade-media/2019/givaudan-unveils-breakthrough-masking-solutions-for-seven-proteins 12 https://www.roquette.com/media-center/press-center/20191202-plant-based-proteins 13 https://www.foodbev.com/news/denmark-invests-in-microalgae-research-as-sustainable-protein-source/ 14 https://www.foodnavigator.com/Article/2019/07/04/Start-up-champions-new-mushroom-protein-for-unprocessed-meat-substitute 15 https://www.suikerunie.com/suikerunienews/suiker-unie-to-produce-protein-from-plant-leaves/54 16 https://medicalnewsbulletin.com/could-the-mankai-duckweed-plant-be-the-new-superfood/ 17 https://mycorena.com/ 18 Fi Global Insights, How sustainable are meat alternatives? https://insights.figlobal.com/sustainability/how-sustainable-are-meatalternatives 19 Fi Global Insights, How sustainable are meat alternatives? https://insights.figlobal.com/sustainability/how-sustainable-are-meatalternatives 20 Fi Global Insights, How sustainable are meat alternatives? https://insights.figlobal.com/sustainability/how-sustainable-are-meatalternatives 21 Fi Global Insights, How sustainable are meat alternatives? https://insights.figlobal.com/sustainability/how-sustainable-are-meatalternatives 22 https://www.mosameat.com/our-story 23 https://www.aleph-farms.com 24 https://www.meatable.com/ 25 https://www.highersteaks.com/ 26 https://shiokmeats.com/ 27 https://www.kearney.com/consumer-retail/article/?/a/when-consumers-go-vegan-how-much-meat-will-be-left-on-the-table-foragribusiness28 https://www.rethinkx.com/press-release/2019/9/16/new-report-major-disruption-in-food-and-agriculture-in-next-decade 29 https://solarfoods.fi/solein/ 30 https://solarfoods.fi/our-news/solar-foods-go-to-market-execution-begins/ 31 https://www.airprotein.com/press-release 32 https://www.annualreviews.org/doi/pdf/10.1146/annurev-food-032818-121204 33 https://equi-nom.com/ 34 https://www.foodnavigator-latam.com/Article/2020/02/06/Novel-and-natural-food-coloring-developed-from-fungi-by-Silicon-Valleystart-up 35 https://crispr.corteva.com/ 36 https://calyxt.com/ 37 https://www.mpg.de/13761643/scientists-call-for-modernization-of-the-european-genetic-engineering-law 38 http://www.fao.org/food-loss-and-food-waste/en/ 39 https://caffeink.net/ 40 https://www.kaffebueno.com/ 41 https://coffeecherryco.com/ 42 https://www.planetarians.com/ 43 http://www.agraalimentation.fr/eit-food-acceleration-network-annonce-ses-laur-ats-2019-art455213-2.html 44 https://www.foodnavigator.com/Article/2020/02/06/Healy-leverages-cocoa-shells-for-natural-sugar-reduction 45 https://www.riseproducts.co/about 46 https://www.fumiingredients.com/ 47 https://cordis.europa.eu/project/id/862957 48 https://www.kattegatcentret.dk/files/AlgeCenterDanmark/Folder_RegionMidt_2013_EN_red.pdf 49 https://www.vttresearch.com/en/news-and-ideas/food-40-vtt-leads-way-era-smart-food-production 1 2

26 | L earn more about Fi Global CONNECT

https://www.nottingham.ac.uk/news/pressreleases/2016/september/new-ai-driven-cleaning-system-could-save-food-manufacturers100m-a-year.aspx 51 https://coca-colahellenic.com/Campaigns/AnnualReport2018/assets/pdf/Coca-Cola%20HBC%202018_IAR_p26-62_15Mar2019.pdf 52 https://www.unilever.com/news/news-and-features/Feature-article/2014/ben-and-jerrys-turns-ice-cream-into-energy.html; http:// crreport.kelloggcompany.com/conserving-natural-resources 53 https://www.veoliawatertechnologies.com/en/case-studies/mars 54 http://www.fdfscotland.org.uk/sfdf/five-fold-2014-kelloggs.aspx 55 https://www.unilever.com/news/news-and-features/Feature-article/2019/we-now-use-100-per-cent-renewable-electricity-across-fivecontinents.html 56 https://www.mars.com/news-and-stories/press-releases/mars-tackles-climate-change 57 https://www.generalmills.com/en/News/NewsReleases/Library/2019/April/Wind-power-agreement 58 http://crreport.kelloggcompany.com/conserving-natural-resources 59 https://www.ciel.org/reports/plastic-health-the-hidden-costs-of-a-plastic-planet-may-2019/ 60 https://www.pepsico.com/news/press-release/pepsico-accelerates-plastic-waste-reduction-efforts09132019 61 https://www.coca-colacompany.com/au/news/world-without-waste-coca-cola-progress 62 https://www.coca-cola.eu/news/marine-bottle/ 63 Fi Europe 2019 Startup Innovation Challenge in Category: Most Innovative Process, Technology or Service Supporting F&B Industry Winner: https://insights.figlobal.com/start-ups/interview-qwarzo-fi-global-startup-innovation-challenge-2019 64 https://www.qwarzo.com/ 65 http://www.fdf.org.uk/transport_efficiency.aspx 66 https://www.supplychaindigital.com/company/general-mills 67 http://www.fdf.org.uk/ambition2025-britvic-transport.aspx 68 https://www.suedzucker.de/en/company/sustainability/planet/logistics 69 https://www.cokecce.co.uk/system/file_resources/401/CCE_Cranfield_Sustainable_Manufacturing_for_Future_March_2016_Final_ Version.pdf; https://www.themanufacturer.com/articles/supply-chain-optimisation-through-automated-warehousing/ 50

The information provided here was compiled with due care and up to date to the best of our knowledge on publication.

Sustainability as a driver of innovation in the food industry | 27

Learn more about Fi Global insights:

insights.figlobal.com