It’s no secret that industrial companies have historically put sustainability on the back burner, but things have changed. These hurdles almost outweigh the incentives to choose a greener path, especially in the traditional food industry, as applications are included that make the implementation of feasibility programs more difficult.
Agworld and agtech have smaller profit margins (2-3%) compared to other industries. This means that everyone is competing for 2% of the revenue, rather than a larger portion worth competing and splitting within the industry. A 40% reduction would affect everyone and potentially increase margins, making innovation a necessity rather than an option. So the product is sold instead of wasted.
It should be noted that more and more companies are becoming “food companies” because of the high returns. This means we have more financial resources to focus on innovative sustainability efforts. Combining industry knowledge with a start-up mindset will help agworld and agtech better capitalize on future innovations.
companies are now ESG initiatives Seriously, because the benefits can be huge. For example, companies with high ESG marks quickly capture valuation premiums. Manufacturers of industrial products also benefit modestly. But low profit margins in the Agworld and Agtech industries prevent traditional food companies from taking his ESG bright ideas and pushing them into tradition. These companies need to break pieces and make incremental improvements in order to achieve true innovation and lasting change. As these companies adopt new technologies, Supply chain improvementthey can fully embrace sustainability and minimize food waste more efficiently.
Midwestern company leading innovation
While traditional food companies have lagged in embracing innovation, there are some outliers paving the way for sustainability. BungeAgricultural business that connects farmers and consumers in partnership with cover cressis a Chevron-invested start-up that brings renewable oilseeds and animal feed crops to market.
The partnership has entered into a long-term commercial agreement to convert annual field Pennycress into a CoverCress crop that has a smaller footprint and is compatible with existing corn and soybean crop rotations. Adding new crops to existing farmland has the potential to bring additional income to farmers, while also providing the ecological benefits of cover crops of improving soil health and reducing nitrogen loss.
This somewhat new focus on sustainability highlights its role throughout the value chain. Sustainability is a long-term goal and ultimately pays off, but shareholders want immediate returns to prove the value of their investment. Sustainability can thus affect profits and losses. But to truly innovate, industry leaders must think beyond the usual profit and loss and understand the true impact of ESG.
For example, agricultural input manufacturers should shift their focus away from how sustainability affects the sale of their products to how it affects them. Solution salesAgriculture operated under an input-output model for as long as anyone can remember. Specifically, how did fertilizer affect the productivity of specific crops.
The farmer’s sustainability mindset is to invest in ecologically sound, evidence-based and cleaner tools and farming methods. Farmers have always prioritized sustainability, but today they can take advantage of digital tools and a renewed focus on new biological products that lead to further innovation and better results.
Sustainability Next Steps for Midwestern Entrepreneurs, Investors and Business Leaders
Sustainability and the traditional food industry have not always gone hand in hand, so industry leaders may be reluctant to embrace the shift towards innovation. However, if a leader can articulate the value of a sustainability initiative, it is worth devoting time and resources. The key question here is: “Should I really do this?” If this initiative brings value and efficiency to your company, the answer is yes.
Here are some ways Midwestern industry leaders can embrace sustainability for years to come.
1. Explore all means to reduce waste
At the heart of all sustainability efforts is waste reduction. Companies that advertise sustainability should make a conscious daily effort to limit resource consumption and waste generation. This may require a lot of nuanced work, research and reflection. But when companies consistently take small steps to reduce waste and make the most of the resources they have, they improve their operations and build value for their investors, audiences, and the world.
Zoom out, should be of interest to everyone involved in food production waste reduction to increase profits. Reducing waste in fertilizer, electrical processes and human resources can improve profitability across the value chain. Specifically, less waste means more materials that can be recycled and composted into crops. It also means more food to process, less waste to landfills, and more supply to meet consumer demand. Additionally, investors will feel more comfortable investing in companies that prioritize waste reduction.
2. Strengthening the supply chain through innovation
Moving to a more sustainable business requires many moving parts. Specifically, the production of products that are even more sustainable. walmartFor example, is working with its suppliers to reduce its carbon footprint across the board. Through Project Gigaton, we have allocated resources to our suppliers to reduce greenhouse gas emissions from our global value chain by one gigaton. As this example makes clear, sustainability requires the ability of suppliers to be truly successful.
again, CoverCress Partnership Bringing renewable seeds and forage crops to market can meet the demand for renewable fuels and strengthen supply chains. That’s because CoverCress used a winter weed that was bred and genetically edited to fit a corn and soybean rotation.
Adding new crops to existing land during the winter is not only beneficial, it is especially good for the soil, covering the ground and reducing nitrogen loss. , which improves supply because more crops can be grown throughout the year.
3. Focus on innovation
A commitment to sustainability cannot be achieved without the right technology to plan for it. Industry leaders must invest in technology to innovate in the food industry, as sustainability comes down to efficiency. In fact, investment in food technology will reach a total of $13.5 billion in 2021.
Investments were down in the second quarter, but one thing is clear. People are dedicating significant resources to technology that helps build a safer, cleaner food system.Soon, cutting-edge technology and more Smart sensor for food packagingfound in all aspects of food packaging.
These sensors are essential for food sterilization and processing, and also reduce waste. They are used in most stages of food packaging. As the technology continues to improve over time, manufacturers will be able to use it to detect microbial contamination and even changes in gas composition in sealed packages. Sensors not only efficiently support the value chain, they also support safety goals. These combinations are key elements of sustainability.
There is a lot to consider when it comes to sustainability in the food industry, from outlining goals to participating in supplier planning. But even traditional Midwestern industries can prioritize sustainability for years to come with careful coordination and the right partners.
With all this in place, companies can work together to build a cleaner, safer food production future.
