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There is a pronounced change in the future of food in the Nordic region, driven by emerging technologies, shifting consumer preferences and environmental concerns.
As we look toward the future, it's clear that our relationship with food is going to change. Emerging technologies, shifting consumer preferences and environmental concerns are all reshaping the way we grow, produce and consume our meals.
In an interview dated 2019, Jeff Wong, EY Global Chief Innovation Officer, discussed how innovation is changing the future of food, with Matt Barnard, Co-Founder and CEO of agricultural technology company Plenty. Thinking beyond the short-term and focusing on innovation emerged as two critical areas for businesses to focus on as they rethink the future of food production and consumption.
The success and growth of companies in the agriculture and food industry depend entirely on the health of the environment. Their core products are derived from the farmed environment and it’s clear that we can no longer continue at the industrial scale we are accustomed to without accelerating climate change and causing potentially irreversible damage to natural ecosystems.
From plant-based meat to vertical farming to personalized nutrition, the future of food promises to be both exciting and challenging. In this article, we'll explore how and why the future of food is changing, and what this means for Nordic businesses.
The emission challenge in the Nordic agriculture and food industry
As the world is becoming more aware of the impact of greenhouse gas (GHG) emissions on the environment, there is a greater push for action from the agriculture and food industry to reduce their carbon footprint. Dairy farmers are under pressure as the public perception is that they are heavy emitters. The CO2 emitted by farm livestock and the energy used for heating in the generally cold Nordic region contribute to a large majority of emissions in this area. Regulators in some Nordic countries are discussing imposing a CO2 tax that could have severe impacts on farmers.
Aside from the emission challenges, industrial farming techniques that degrade the soil, and pollutants from pesticides and nutrients that seep into the lakes and the Baltic sea are big threats in the Nordic region. We need a massive shift to more local, regenerative agriculture and heavy investment in de-coupling from nature through alternative lab-grown proteins and plants, cell-cultured meats, plant-based diets, etc.
In line with the global trend, Nordic consumers are demanding more sustainability initiatives in the agriculture and food industry. If companies are perceived as being passive or greenwashing, they risk losing consumers. However, consumers will play a relatively small role in the larger picture, for the industry. There is of course demand, expectation and pressure from consumers for more sustainable options, but most people are quite price-sensitive. In fact, many companies are making big sustainability moves behind the scenes in their value chains and processes, but very little of that is visible to the consumer.
As companies move from compliance to beyond compliance, we could see more consumer-level changes, especially in the “hot topic” industries such as fashion, food and fast-moving consumer goods.
Kaisa Korri
Partner, Consulting, Technology Consulting, EY Finland
Leveraging technology and innovation for a healthier world
In the Nordics, companies have been focusing on CO2 emissions reduction in the last few years. For instance, certain companies have been successful in identifying the primary drivers of emissions and are now focusing hard on these to drive significant reductions for all farmers. While tackling low-hanging fruits such as reducing travel is important, companies realize that the next step must be driven by technology. However, while some companies are strong on development, they are struggling to identify which technologies and initiatives can make a real difference.
There are already many new Nordic startups that are developing alternative foods and food ingredients. Large progressive companies are investing in new, more agile “ecosystem operating models” with startups and various partners to develop new business models and more sustainable food products and services.
The extent to which technology and innovation are leveraged by Nordic companies varies. While the government-level strategy is on the right track and setting goals, the maturity of individual companies is the bottleneck. For example, some large companies in the Nordics struggle to integrate innovation and digitalization into their existing business model, and at the same time are not investing enough in future-proofing their operations.
There are opportunities for Nordic companies to leverage technology and innovation to drive change. By identifying the most significant drivers of emissions, companies can make a significant impact on the environment. Moreover, taking sustainability seriously will be a license to operate and a key factor in maintaining consumer trust.
Summary
The future of food in the Nordic region will be shaped by those companies that embrace innovation and sustainability as the path to a healthier and more sustainable future.
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