A global view and a national strategy
I’ve talked a lot about the need for a national strategy for the food sector, or as I refer to it, Canada Food Inc. I talked about ways to put that kind of strategy together and implement it. But let’s step back and look a little more closely at the global market for food and how that will affect our strategy.
We know that the demand for food is growing faster than ever in history. This is due to the increasing population that will hit nine billion by the 2050s. And it won’t stop there. I’ve heard predictions that 10 billion may be the number by the end of the 21st century. Can we feed them? At this point it’s a little hard to tell.
And add to that trend the growth in personal income in the emerging countries in East Asia, Southeast Asia, South Asia, Latin America and so on. There are more two-income households as well. So those consumers are going to be looking more and more for prepared foods that do sell at a higher price.
It certainly looks like an export opportunity for the Canadian food sector. This is being recognized in many ways, starting with the federal government’s program to get more SMEs into exports. The smaller companies are seeing this as the best way to grow their markets. The larger companies see exports as a means of increasing the scale of their production to bring down costs through productivity gains. And if Canada can show them some locational advantages if our national strategy includes increasing exports, it may encourage some of the foreign-owned multinationals to stop closing their Canadian plants and invest here instead.
Canada does have some advantages that can help us succeed in this growing world market for food. First of all, we have a high level of arable land, one of the highest in the world. And we also have a fairly high percentage of the global fresh water supply. As well, we have a highly diversified food production sector including red meats, poultry, dairy, fish and seafood, grains, oilseeds, pulses, fruits, and vegetables, all of which are high quality, leading to consumer appeal. But, and that is a serious “but,” there are many things we will need to do to take advantage of this huge opportunity.
First, we need to have a vigorous sustainability strategy that includes careful care of the environment including the land, water and air. We must find ways to actually improve our performance in those areas, as well as reduce our energy usage per tonne of food produced. That means produce more with fewer natural resources and produce less waste of all types at all levels, and/or find ways to productively and safely use that waste in a value-adding manner. Sustainability also means we must produce nutritionally healthy foods with a high level of food safety.
Second, we need to improve our productivity or cost per unit to produce. This may take innovative new technologies and definitely a clear focus on continuous process improvement with tools like Six Sigma and Lean. But, and again a big but, we need to work together up and down the entire value chain to make it more productive in all commodity areas and improve the quality of our products as well, based on the demands of the various markets all around the globe.
Innovation certainly comes into play as a result. It will mean understanding the consumer market better, and being more innovative in the products we produce, as well as packaging and processing technologies. Innovation certainly also has a strong role in increasing productivity and sustainability. Let’s figure out better new ways to accomplish these things.
All of this can only be done to maximum if we work together up and down the value chain, both the operations value chain and the innovation value chain made up of scientists, researchers in universities and technical commercialization centres, and companies in the industry.
In order to do all of this we need a national food strategy, with tweaks for each of the commodity sectors like grains, oilseeds and meat. And, that strategy will need positive interaction with the federal and provincial governments.
It needs to start with a vision of what “Canada Food Inc.” is focused on achieving over time and a more detailed strategic plan to achieve that vision.
More and more, I hear people speak of such things, but we need the leadership, mostly from the business community, to make it happen. Let’s do it. We can 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]
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