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What Americans can learn from other food cultures – ideas.ted.com

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There is no sincerer love than the love of food.

~ George Bernard Shaw 

Driver of Agriculture Megatrends – Culture

The third and last driver of agriculture megatrends I’ll address is culture.  How do changes in how food is communicated and celebrated in society impact the future shape of agriculture?

Components of Food Culture

The five components of food culture include the following.

  • Tradition – Foods, ingredients and cooking methods passed down from one generation to the next.
  • Geography/Natural Resources – The land, water and weather’s impact on food availability and distribution.
  • Cooking – The art, technology and craft of food preparation.
  • Food service – Businesses, institutions, and companies responsible for any meal prepared outside the home.
  • Affluence – The impact of disposable income on food consumption patterns.

First an example from food service.

An important issue in the modern world is expenditures for food at-home versus away-from-home.  In the United States, for example, consumers now spend about 50 percent of food dollars away-from-home.  Per meal expenses are higher away-from-home, so it is less than 50 percent of meals that are consumed away-from-home.  However, this dynamic explains the importance to agriculture of ingredient decisions by large food service businesses such as McDonalds.  Back in the 1980s, my Dad was absolutely convinced that the occasionally-offered McRib sandwich at McDonalds positively impacted pig prices when the sandwich was available.

Food Expenditures at Home and Away From Home United States

The U.S. Grains Council Food 2040 study predicts that the United States will move to 58 percent of food expenditures being away-from-home by 2040.  For China it predicts the same number will move from about 25 percent today to 65 percent in 2040.  For Japan, 75 percent!

Our ultimate customer in agriculture is the individual, but as their food decisions become more integrated into away-from-home experiences, those food services businesses become even more important.

What about food retailing?  The most important trends right now are 1) electronic commerce and 2) the growth of fresh format retailers.

Food Retailing Projections 2016 to 2020

Source: Willard Bishop. 2016 The Future of Food Retailing.

Twenty years after early entrepreneurial efforts to take food purchasing online mostly failed (WebVan), the Internet has begun to impact food retailing.  From Amazon to local grocer HyVee, electronic ordering and delivery of food is growing quickly.

An affluence-related cultural impactor is the link between health and wellness and food and nutrition.  This expresses itself in food consumption expenditures in many ways.  Specific products, for example, burst onto the market.  Coconut water sold less than $50 million in the U.S. ten years ago and now exceeds $500 million.

Product categories are also impacted.  Natural and organic food product sales in the U.S. have had compound annual growth of 10 percent and now account for more than $60 billion annually.

A sizable group of consumers in the U.S., and in many other countries, now bring a set of value judgements to food purchases that are difficult for many in production agriculture to understand.  One result is a frantic search by food companies to be able to make sustainability claims for their food products.  The challenge is that they need to reach back into production agriculture to get data to be able to make claims.  Do many want to pay more to agricultural producers if they can make sustainability claims?  Not right now, but the issue, and others arising from food culture, will not go away.