Food and Drinks in the Coming Era of Food Insecurity

January 2024

The rise in global food insecurity will be a defining challenge for the food and beverage industry in the coming decades. Once-reliable supply chains are under threat from climate change and geopolitical shifts, which means the future will be one of higher prices and more frequent shortages. Understanding this new landscape will be critical to success in the years to come.

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This report comes in PPT.

Key Findings

Food insecurity is on the rise globally, and this is likely to continue for decades

After gains in global food security in the 1990s and 2000s, trends have reversed, and larger numbers of people in the world are becoming food insecure, as prices rise under pressure from climate, geopolitics, demographics and de-globalisation. This situation is very likely to continue to worsen in the coming decades, as these underlying drivers strengthen.

Food inflation is not a transitory phenomenon and will be a basic reality of the future

The growing population of the world will increase demand for food, even as climate change ravages growing areas, transport becomes more expensive and difficult, and labour forces shrink from ageing populations. All of this points to a future in which food prices are significantly higher in the long term.

Food will be dragged into the increased geopolitical conflicts of the coming decades

The new era of multipolarity will mean jostling among the great powers as a basic feature of global politics. Although there is a risk of serious military conflict among them, using food as a tool for geopolitical influence below the threshold of armed conflict will be also common, and export bans, prioritisation of allies for exports, cyber disruption, threats to shipping, and other aspects of this competition will challenge the food and beverage industry’s ability to operate.

Supply chains are going to have to be shorter and more resilient

With the new global realities, companies in the food and drink space will need to prioritise reliability. This means a world with fewer SKUs available and with more products made using local ingredients or using new food tech, like advanced fermentation methods.

Consumers will seek to economise, and optimise their health

With food prices high, consumers will naturally seek cost-effective options, but the consumer reaction to food insecurity will be more complex than that. For those who can afford to splurge a bit, optimising one’s health will take top priority in an era of uncertainty, while small, “permissible” indulgences will play a major role.

Key findings
Food security will be one of the defining issues for food and beverage in the coming years
Globalisation has peaked and is giving way to de-globalisation
The future will be more inflationary than the past
Population growth will strain existing food systems
Where is food security going to be most in jeopardy in the years to come?
The post-Cold War order has ended and what follows it will be much more complex
Significant portions of global trade go through vulnerable chokepoints
The war in Ukraine shows the new realities of the global system and what it means for food
Export restrictions will create negative feedback loops that further increase prices
Much will depend on how the US chooses to wield its food power
The Chinese quest for self-sufficiency in food will have global ramifications
Russia will use its food capabilities to maintain its geopolitical influence
Yemen, the Red Sea and the declining cost of disrupting global shipping
Sustainability is a supply imperative more than a way to win over consumers
Declining product variety is likely as globalisation shifts into reverse
The UK’s 2023 vegetable crisis will not be the last
Sriracha, peppers and climate-driven product shortages
National security will bring adoption of new tech faster than pursuing climate goals
Dietary changes would increase self-sufficiency but are culturally fraught
Most of the world could be significantly more self-sufficient in food production
Case study: Where will the world’s coffee come from in 2050?
Where is the consumer in all of this?
Calories are becoming more expensive
Price already dominates consumer path to purchase on food and that is unlikely to change
Self-optimisation will be the first line of consumer defence in an uncertain world
Mental health functionalities will gain ever-increasing importance
Personalised nutrition will further push consumers away from mass global brands
Consumers are not especially attached to food imports, but quality does matter to them
Indulgence will certainly not go away but it will need to be “permissible”
Questions to consider


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