Let's ensure the food industry will succeed when export development opportunities arise
As I said in my last article, we are definitely on hold for the short- to medium- term with regard to our ability to develop and implement our export strategy. It’s clear that the U.S. presidential election will have a major impact on NAFTA, likely negative for Canada. We keep hearing more from both Trump and Clinton as to the need to renegotiate it or get rid of it. We have heard the new British Prime Minister Theresa May commit to being out of the EU by May 2017. Where does that leave the potential CETA agreement? And we have a long wait to find out what will happen with the TPP agreement. Interestingly, Prime Minister Trudeau may have made some progress toward a trade agreement with China. In the meantime, there are still many other things we can do related to improving other areas of the food and beverage sector value chains in areas like innovation, productivity and sustainability, that will strength our sector significantly and make it even better able to succeed in the export development opportunities that do arise.
In a recent report by Value Chain Management International it was stated that we waste about 31 per cent of food available for consumption, about 10 per cent at the retail level and 21 per cent at the household level. That is about six billion kilos per year. Think of the impact on the availability of food globally as we continue to a global population of nine to 10 billion by 2050. To improve those numbers, we need to work together along all of the various value chains within the food and beverage sectors. This combined effort could also be applied to the environmental sustainability issues along those same value chains.
All of that should be done through industry/government partnerships so that it can have a positive impact on the government policies and legislation that end up as regulations. Once again, it seems to me that the Agriculture and Agri-Food Canada (AAFC) Value Chain Roundtables is the right place to create the level of co-ordination needed. However, the sector value chains will need to act somewhat independently to ensure their sectors benefit to the greatest possible extent. But, there needs to be a “total industry” approach which, as I have said before, could possibly be co-ordinated by the All Chairs Forum, including the leaders of all of the AAFC Value Chain Roundtables in collaboration with AAFC management itself.
So all of that type of activity could solve many of the productivity and sustainability issues we face. We can improve the product quality, cost and service levels all through the value chains right to the consumer, and that can improve the profitability of the industry. We can improve our overall impact on the environment and improve our image in the areas of corporate social responsibility, for example, ethical treatment of animals, to name one.
Then, of course, there is the whole area of innovation. We must do some more market analysis of consumer needs, wants and demands, here in North American and also in potential export markets. That analysis must then be collaboratively dealt with by product developers and marketers in food and beverage companies, food scientists and food processing engineers in universities and technical development centres, and the agriculture and fisheries operators in each sector to get the market what it’s looking for.
The whole area of innovation can also have positive impacts on productivity and sustainability in that we are likely to find better ways of growing foods, processing foods, or packaging foods, in other words, new technologies are likely to emerge.
I know it may sound a bit complicated to make all of this happen, but I do not believe it would be as difficult as it may sound. It would take some serious collaboration between senior management of all of the sectors and levels of the industry, combined with senior officials of AAFC and perhaps one or two other government ministries like Fisheries or Industry.
The bottom line from carrying out all of this would be that the Canadian food and beverage industry would become more competitive than it is now, would be seen by the market place – consumers, retailers, and foodservice operators – as a very desirable supplier with excellent products at reasonable costs produced in an environmentally and socially responsible manner. I know it can be done. Let’s do it!
Gary Fread is president of Fread & Associates Ltd., consultants to the food industry. He has spent more than 25 years in management positions in the food processing industry, with a background in sales, logistics, purchasing and technical areas. He has worked with Procter & Gamble, Campbell Soup and Morrison Lamothe, and is the past president and CEO of the Guelph Food Technology Centre. He is active in many food industry associations and organizations, serving on the boards of several. Contact him at [email protected]