Feeding the World: A Perspective on Sustainable and Affordable Food
This article is part of a series of short blogs by the Food & Agri team of Anders Invest. Here, we outline our perspectives on key themes that are relevant to the Food & Agri sector and explain how we try to make an impact with our portfolio companies and investment strategies.
As the world's population inches closer to 10 billion, the escalating food demand is unignorable. To meet this, global food production must ramp up by 50-70%, a challenge intensified by the 2.3 billion individuals already grappling with food insecurity. In addition, there is the simultaneous necessity to mitigate climate change impacts, underscoring the dual challenge of affordability and sustainability that more and more defines the food and agricultural sector.
The challenge is that we’re trying to feed the growing world population while also needing to take care of our climate and all the different kinds of life on our planet. This situation has led to two different ways of thinking: agroecology and ecomodernism. Agroecology supports sustainable food production, leaning towards organic farming that takes care of the soil, clean water, biodiversity, and nutritious food. On the other hand, ecomodernism focuses on using technology and producing a lot of food on a small piece of land, suggesting a strict separation between farmland and other ecosystems where nature can flourish.
Strike the right balance between satisfying the imperative demand for accessible food and tackling the pressing issue of climate change, and you'll find yourself caught in the midst of a high-stakes struggle.
Volkert Engelsman, the founder of Eosta BV / Nature & More, simplifies this complex dilemma: “We are losing 30 soccer fields of fertile land every minute, profit can only be profit if it doesn’t jeopardize people and planet. While affordability is undeniably vital, it is equally important that we conduct comprehensive calculations that account for both the positive and negative externalities associated with nutritious food, social inclusion, and ecosystems.”
Nevertheless, Hidde Boersma, in his thought-provoking piece for the Correspondent, sheds light on the ecomodernist view: “Through the adoption of intensified farming techniques, we possess the capacity to free up farmland spanning the entirety of Russia. This staggering feat can be achieved by harnessing the power of a 25% boost in crop productivity.” Boersma passionately argues that this preserved land, no longer under the plow, could be transformed into thriving natural ecosystems, becoming havens of biodiversity and environmental balance. However, Boersma's ideas regarding factory farming rest upon a set of assumptions that blur our understanding of ecosystems and microbiomes, misrepresenting their true workings. An oversimplification of nature allows for easy commodification and scalability but diminishes the intertwined complexities that constitute as nutritious food utilizing only a fraction of the required DNA of plants and neglects the importance of sunlight and instead using LED lighting.
At Anders Invest Food & Agri Fonds, we understand that a one-sided approach risks overlooking the intertwined complexities of social development and environmental sustainability. In the short-term, there is a contention that a solely organic system lacks affordability for all, without taking into account negative externalities such as the increasing healthcare costs associated with food-related diseases, water pollution, and nitrogen intensification. Conversely, an excessive focus on agricultural intensification disregards environmental considerations, biodiversity depletion, water pollution, and the potential dependency of developing countries on western technology.
As we analyze the crux of the matter, a distinct pattern comes into focus. It becomes increasingly apparent that the organic system exhibits minimal to no yield loss for fruits, while grains suffer a more substantial decline. Considering this significant revelation, we propose a focused strategy: let us channel our efforts into cultivating fruits using entirely organic methods, effectively demonstrating the positive impact on consumer prices while the lower yields justify a slight premium for the grains. After all, to provide affordable and organic sustenance for our rapidly growing global population, it is imperative that we address the global power dynamics within the food and agriculture sector. This involves reducing the substantial portion of land currently allocated to animal production, which currently stands at 70%, and prioritizing the availability of nutritious food worldwide. We will dive into these subjects in a later blog. Stay tuned!
