How digital innovations are taking a bite out of food loss
Food supply chains are more complex and less efficient than the name suggests. Market fragmentation and asymmetries of information within them are key drivers of food loss. Now digital innovations are unlocking flows of information and enabling new connections, making food chains simpler, faster, and more transparent. Forum for the Future conducted a global scan of food logistics solutions emerging today, and found this is happening in three key ways:
Enabling transparency of conditions in transport / Seeing food safely through the chain
One problem is that downstream buyers know very little about what actually happens to food along the supply chain, and particularly the conditions in which it travels. For example, some transporters turn off air conditioning units in refrigerated containers en route to save on fuel costs, increasing food spoilage. But how much food is lost due to different behaviours, and who’s responsible, is hard to say, because buyers have no way of monitoring the journeys. Now, applications are making all the different conditions and connections visible.
Sensor-based tagging systems can track the external conditions of products along the supply chain, either for a pallet or for each box in it, and share that information in real time. CoolAsia offers a fleet tracking system that monitors temperature and humidity at different places within a reefer container, revealing how products experience temperature fluctuations differently, depending on the type of product, as well as its position within a container. Others like FedEx’s Senseaware and Netoria Technologies offer similar solutions.
High-risk and highly nutritious fresh seafood and other meats are often discarded by a certain use-by date without any certainty as to whether it is still fit for consumption. Time temperature indicators such as Timestrip change that by giving consumers confidence that these foods are safe, which could help ensure precious nutrients that would otherwise be wasted get enjoyed safely.
Taking this to scale
These types of innovations need to be made available to smaller-scale food supply chains and the producers operating within them that provide the majority of the world’s food. For such scale to be viable in the short-term, public-private partnerships are needed to overcome cost barriers.
Sharing consumer demand data upstream
E-commerce is enabling new market efficiencies, thanks to more accurate and detailed information about what consumers at the end of the chain actually want, and how they make decisions. Online grocery ordering at scale allows retailers to discover how diverse factors -such as the weather, consumers’ income and geographical location - impact what gets purchased and eaten and when. This information can then inform decisions about what to stock in their warehouses, and enable them to place more accurate orders with their suppliers. This helps to reduce the quantity of food supplied but not sold. A good example of this is the City Bakery in New York, which has found patterns in holidays, weather and other factors, and is using these insights to determine how many fresh pastries it needs day to day or even hour to hour. In many consumer food markets, unsold baked goods account for the largest proportion of retail food losses. Opentaste.sg, a platform that cuts out multiple middlemen, is able to also reduce waste by passing better, more stable demand information further upstream.
Taking this to scale
From a food system perspective, the use of big data and e-commerce platforms to improve demand forecasting can only really impact the development of food losses if it can influence decisions about what to produce in the first place. Not only does this information rarely make it all the way back upstream to farmers, but farmers also may not have the technical capacity to analyse data and turn it into better decisions. Technical assistance to help farmers upgrade their planning capabilities is needed.
Even when information reaches that far, the reality of multi-month or yearly growing seasons makes it difficult for farmers to respond quickly to new information. Complementary innovations that reduce growing seasons could lead to unprecedented levels of responsiveness of agricultural production to consumer demand, but have serious livelihood implications for small farmers worldwide that would need to be unpacked.
A best next step for this technology would be partnership to allow for the aggregation and public dissemination of consumer purchase information. At the moment, much of the data is collected privately and seen as proprietary, limiting its ability to improve the efficiency of the overall food system. It could also be useful to aggregate information on intentions to plant, so that farmers could easily see how much of projected consumer demand was already met by the domestic market and where they could potentially make up for shortfalls in production.
Taking out the middlemen
In rural food supply chains, intermediaries take advantage of asymmetries of information to extract a margin, often at the expense of producers. New systems allow farmers to completely bypass intermediaries and communicate directly with retailers, or even consumers. Indian start-up Supr Daily uses Whatsapp (the free messaging platform) to address both delivery and quality issues in India’s milk supply chains by removing all middlemen. New York food hub Greenmarket Co. connects locavores and regional producers, bypassing national supply chain infrastructure. Singapore’s new urban food system hub will consolidate small food orders from the island’s myriad food stores, simplifying retail food logistics and reducing the number of trips and, consequently, urban congestion. While not designed specifically to reduce food supply chain losses, these systems correct market failures and cut time to market, reducing opportunities for spoilage.
Taking this to scale
Information platforms could also share data on prices for transport services, depending on different levels of services (trained loaders, refrigeration, etc.) Ideally, small distributors and exporters would make decisions about carriers based on their performance record, gathered through these tracking systems and shared publicly. We’re still waiting for the ‘uberization’ of rural supply chains for perishable goods. Also, digital platforms could be used to coordinate across industries, identifying and acting on opportunities to harness non-edible food waste for use as inputs in other industries, such as flavourings or biofuels.
Our goal is to have over 100 innovations on a open source digital map by the end of 2017, and we’ll need your help to ensure it is the best possible resource for food logistics innovations. If you think we’ve missed a crucial innovation and want to add to our list, please send us an email at email@example.com!
The Disrupting Food Logistics project included the creation of a Global Food Logistics Innovations Map, including the sourcing of 50+ innovations in food packaging, cold chain, ICT and supply chain design. Compiling the results of this process gave us some of the puzzle pieces to fill in a full picture of a future vision for sustainable food logistics, as well as an idea of the cutting-edge in these four categories. Through a series of Disrupting Food Logistics blogs, we will be sharing these insights with you. These blogs will later be compiled into a full report.