The effects of COVID19 arent showing any signs of slowing down and companies and the food system as a whole are adapting as best they can to try and whether these changes happening in their daily life and business. Last week our partners at F&A Next hosted their fifth annual summit online, as they looked at the impact of the pandemic on foodtech and agrifood sectors. To makes things easier for you, Agfunder has put together the key takeaways from the webinar, on how covid will reshape how we make, transport and consume food in the future.
A sexier supply chain in 2020
Restaurant platforms like Deliveroo were big winners in venture capital investment in 2019, according to AgFunder’s latest European Agri-Foodtech Investment Report. In fact, it turns out that services like e-grocery and cloud retail which encompass ghost kitchens and last-mile delivery services were the most invested in across the complete supply chain. Given the current circumstances and the importance of safer food delivery, that trend might remain.
As covid disrupts the long-standing supply chain food startups are searching for new and more resilient solutions to invest in.
Anuj Maheshwari, managing director of agribusiness Temasek said; “A lot of countries are worried about food security, and the best way to deal with food security is to produce locally.”
Temasek is based in Singapore, where most food is currently imported, but border closures and travel constraints with neighboring Malaysia has shown just how risky it is relying so heavily on imported products, and therefore may lead to more investment in the development of agri-food in the country itself. The only issue is that Singapore is very small and doesnt have enough land to grow food naturally. Therefore, the only solution would be to use technology including vertical farms or cell-based protein.
Automation in farming and food processing is key to make localization work.
Back to basics for consumer tastes and demands
With the whole world confined to their homes, furloughed jobs and pressures on disposable income, food consumption trends have shifted. The demand for canned and non-perishables have made a quick comeback as people over-stock in their pantries.
According to Adam Anders, managing director of Anterra Capital, the agri-foodtech venture capital that’s part of the F&A Next consortium, when people buy fresh food they now focus primarily on locally-produced goods.
Food producers need to realise than due to the upturn of the economy and a potential recession situation post covid, luxury items wont be making their way onto peoples weekly shopping list. Although this adds an extra pressure for many companies, to produce food that is actually seen as a necessity to people, it also offers new opportunities to be more creative and develop new lines of business.
Unpredictable times drive unpredictable behaviors.
Unhealthy food i.e. comfort food is on the rise, as people find ways to deal with the stress of lockdown life.
“People are not as much interested in weight loss,” amid the pandemic, stated Alon Chan, co-founder of consumer intelligence platform Tastewise.
However, healthy eating is also on the rise as people become more interested in boosting their immune systems amid the virus panic.
Reshaping food around science, health, and sustainability
Its important to note that some new consumer trends will be short-lived post pandemic. Canned foods for example may lose their necessity after lockdown is lifted. But all of the webinars participants agreed that the virus has created a big consumer demand for more healthy food products.
“I think people automatically get more interested in their health. Everybody is thinking about health—that comes up in top of mind,” reported Rickard Öste, founder of dairy-alternative company Oatly.
Since lockdown there has been a massive demand created for alternative milks and plant-based products. Perhaps due to more health-conscious consumers.
This may drive a need for the development of more science-based food. Some food fads often lack scientific evidence to suggest the overall benefit they have on peoples health and the global food system.
Developing new products to keep up with consumer trends is a good way to improve our overall food system.