50 Trends Influencing Europe's Food Sector By 2035

are decisive for the purchase. In the future, the ratio of12Changing legal framework for retailers different purchasing options such as specialist retailers,weekly markets / farm-gate sales by producers, onlineFor the retail trade, at the interface between pro trading or convenience stores will change considerably.duction and consumption, an abundance of regula tions is relevant. Supply chains are affected by tradeagreements such as TTIP, CETA and Mercosur andother global developments such as Brexit. For the first10time, the EU's package of measures on recycling alsoPeer to peer based consumptiondecisions addresses obsolescence. The Packaging Ordinance isalready available in the 7th amendment, among otherthings for addressing the online trade. Packaging ofNetworks of people around the world advising eachfresh foods for delivery services is also heavily regu other are the dominant factor in democratized con lated. The Food Information Ordinance (LMIV) healthsumption and purchasing decisions for products andpromotion measures such as a sugar tax, the foodservices. Competing and complementary digital plat traffic light system or other nutritional labelling haveforms provide access to detailed product informationbeen widely discussed.provided in a transparent manner. At the same time,retailers have bridged digital and physical shoppingexperiences so that virtual shopping now involvesa range of personalized high quality interaction tosupport the consumption decision making.13Digitalization of trade In the Point of Sale of the future, virtual and realworlds are increasingly merging (including automa 11tion and networking with Supply-Chain Manage Increased market power of retailers ment, multimedia shopping environments for anindividual customer approach, virtual shelves for priceThe world's wealthiest companies include Walmart,comparison). Online trading is also growing stronglyFast Retailing, IKEA, H&M, Tesco, Carrefour and thebecause of “Amazonization“ in individual segments.discount chains Aldi and Lidl. The balance of pow When online and offline are combined, the range ofer has shifted from fast moving consumer goodspurchasing processes is widening from incrementalproducers such as Unilever and Nestlé to retailers.(e.g. smartphones in shops, delivery of products toRetail is highly localized in Germany, which is whya store) to disruptive (e.g. automated shopping onfew players can significantly change distributionthe Internet of Things). Digitalization is making datae.g. drive-in, delivery services and pick-up stations.protection and data security more important, but alsoCurrent delivery services are being developed in coop makes customer data more valuable.eration with retailers, which maintains their power.Through its gatekeeper function between productionand consumption, the retail trade has a considerableinfluence on prices, quality, preferences, assortment,and production conditions.14Diversification of business models andmarketingThe stationary retail trade relies on its strength ofthe emotional shopping experience and uses strat www.isi.fraunhofer.de

egies such as pop-up stores or viral marketing.tainable agriculture and helps farmers preserve ruralOnline-Shops also use Pop-up stores occasionally toareas. While the concept sounds simple, it means thattest their products. Retailers are increasingly address we must radically change the way we participate ining their customers via various channels such as Pointthe act of growing and consuming food. In countriesof Sale, websites and various social media platformsaround the world, a number of social innovations(multi-channel marketing). At the Point of Sale, differ are emerging in the context of this vision of localizedent senses are addressed to influence the perception,food production and consumption chains.evaluation and behavior of the customer (multi-sen sory marketing). The Internet of things opens up newpossibilities such as automatic checkout systems,automatic transmission of product status informationand orders from home.17Changing food systems While population growth increases the demand foragricultural products and stimulates farming activ 15ities, urbanization requires food to be easily storedBlockchain and smart contracts and transported. Thus, food processing has becomea key factor in the transformation of food systems. ItCompanies may be able to automate and decentral has brought with it the standardization of agriculturalize the management of their operational business.output and, in many cases, the localization of primaryBlockchain technology and smart contracts makeproduction and the consolidation of farmland. Manythis possible. Blockchain describes a decentralizedsmallholder farmers have become landless agricultur database that records transactions and stores themal workers, or have migrated to towns and cities inin chained blocks (e.g. Bitcoin). The owner is not ansearch of employment, accelerating urbanization.institution, but the network. The transactions arechecked and validated by the network itself, whichrequires an encryption / digital signature. Smart con tracts are self-executing contracts with the terms ofthe agreement between buyer and seller being direct ly written into lines of code. Trust in Blockchain needs18Increased requirement for transparencyof supply chain to increase and data protection regulations need tobe updated for a wider application of Blockchain andMany consumers demand more transparency andsmart contracts.control along the often complex and opaque sup ply chains because of increased specialization anddivision of labor. The product origin plays a greaterrole in consumer decision-making. Incidents such as16Local food circles the collapse of a textile factory in Sabhar, Bangladesh,in 2013 or Food Fraud (targeted ingredient fraud infood) usually outrage the public in the short term andA food circle is a new way of conceiving and orga can lead to long-term loss of consumers. Individu nizing our agricultural and food systems. It connectsal companies are restructuring their supply chainsthe many people involved in food production in anaccording to new ethical standards. Cross-companyinterdependent and holistic way. Practically, a foodstandards and cooperation (e.g. f-trace developed bycircle is engaged in promoting the consumption ofGS1 Germany) to promise to meet the new require safe, locally grown food that will encourage sus ments as cost-effectively as possible.6 7

19Sustainable production and value chains 21Do-it-yourself as competition toindustrial production The value chain consists of all steps included in theproduction, consumption and disposal / recyclingMore and more people worldwide are starting toprocesses of a particular product or service. A typicalproduce goods and services themselves – alone or invalue chain goes from raw material sourcing tosmall communities – instead of buying them. A widedisposal, through suppliers, manufacturers, retailers,variety of goods such as clothing, software and ener consumers, and other actors. In the circular model ofgy are thus produced directly by private individuals orthe value chain, materials are reused or recycled torepaired instead of new purchases. Borders betweenminimize waste. In the sustainable value net, thereconsumers and producers disappear. Emphasis on indi are no longer up- and down streams but a networkvidual creativity for identity formation and rediscoveryof interactions and value ex-changes. The conceptsof local crafts traditions, complementary to globaliza of production and consumption become increasinglytion is an important characteristic. In the food sector,blurred. Seamless integration of small producers willDo-it-yourself does not mean cooking, but rather pre allow procurers to meet demands for locally sourcedserving products for stock. In other words, productsfood and reduce waste.that we would otherwise buy in supermarkets, such aspreserves, cans and fermented foods.20Convergence of the food and healthmarkets 22Sharing instead of owning Increasingly, food should not only satisfy the re There exists a growing number of movements, initia quirement of being “tasty“ and “healthy“, but alsotives, entrepreneurs, and new business models thatpromote health and beauty. The boundaries betweenaim to facilitate sustainability in the way we consume,the individual industries and products, from food andlive, and move. One example is the collaborative con pharmaceuticals to cosmetics, become blurred. Drugsumption (sharing, swapping, etc.) revealing a shift instores and supermarkets are competing for custom preferences away from ownership of goods to “ac ers, who put an emphasis on healthy food. Pharma cess” to goods and services and from being passiveceutical, food and cosmetics manufacturers are thusconsumers to becoming co-producers of goods andpenetrating each other's fields. They exert influenceservices (e.g. urban farming, growing your own food).on agriculture in order to secure its raw material basePooling resources in various ways is becoming integraland steer it in the right direction. As consumers wantto urban life and is likely to influence the future of cit reliable information about a products health effects,ies. For consumers, collaborative consumption meansregulators are putting strict limits on health claims inconvenience, innovation, local, virtual currenciesadvertisements.community and also green values.23Sufficiency society A constant and still existing assumption in politicalscience and economics is that economic growth leadswww.isi.fraunhofer.de

to an increase in the prosperity of society. This is jus cause of occupational disability. The phenomenon istified by the fact that growth enables new jobs, risingnot limited to the elderly. Many people already fall illincome and a social system that secures basic needs.in their young and middle years. Diseases are multifac Recent findings show that this relationship has beentorial; factors can be environmental toxins, malnu shaken. The issues of “social responsibility“, “qualitytrition, noise, a lack of exercise, changes in workingof life“ and “qualitative growth“ (counterweight toconditions, alcohol and nicotine consumption, etc.economic growth) are gaining in importance. Suffi ciency research questions which personal, economicsocial and political conditions stand in the way of anorientation towards moderate consumption and aredefinition of good life and how these obstacles can26Urbanization be overcome.While, in general, world population growth is slowingdown, in some regions population will continue toexpand well beyond 2050 and even into the next24century. More people now live in cites than in ruralSlow life movement and Downshifting areas, and this discrepancy is projected to increaseas population grows. The effects of urbanizationDownshifting is a social behavior or trend towardinclude, inter alia, increased resource use, increaseda simpler life: It emphasizes an improved balancevulnerability to natural and other disasters as wellbetween leisure and work; the focus is on life goalsas the strengthening of the trend of declining birthsuch as personal fulfilment and building relationshipsrates. Urbanization has been also accompanied byrather than the pursuit of economic success alone. Ita transition in dietary patterns and has had greathas the same orientation as the Slow life movement,impacts on food systems.which aims at reducing life's pace and eliminatingnonessentials from your life. Downshifting is by nomeans a radical turning away from society, as in thecase of so-called “dropout“. Rather, it means takingcautious, clever partial steps to reduce the workloadto an individually acceptable or desired level and27Competition for land in urbanagglomerations to use the resulting freedom for more diversity andmeaning in life.Land intensive economic sectors (e.g. agriculture)compete with the living and working space of othersectors due to increasing urbanization. The sustain able securing of urban food and resource supplies25Civilization diseases on the rise is increasingly becoming a challenge – especiallyin densely populated cities with limited access tosurrounding agricultural areas. Furthermore, intensiveLiving conditions in industrialized countries are caus farming practices and the massive use of chemicalsing an increase in diseases that are only prevalent inare putting pressure on natural resources. Againstthese regions. These are generally non-transmissible,this background, the first pilot projects are workingbut often lead to temporary or early retirement. Exam intensively on innovative cultivation methods andples are cardiovascular diseases, cancer, tooth decay,technologies (e.g. urban farming and gardening) thatdiabetes mellitus type 2, and eating disorders. Mentalwill bring food and resource production back to theillnesses are strongly becoming the most frequentplaces where it is consumed.8 9

28Resource utilization ernment has taken radical action to ensure that themountain of wasted food is recycled. Dumping foodGlobal consumption of energy, water, and other stra in landfill was banned and the government introducedtegic resources is drastically increasing. This relatescompulsory food waste recycling using special biode to fossil energies, fresh water, minerals, and metals.gradable bags. An average four-person family paysRising energy and resource consumption is being driv 6 a month for the bags, a fee that helps encour en by population growth and economic development,age home composting. The bag charges also meetparticularly in developing countries and emerging60 percent of the cost of running the scheme, whicheconomies. Even though fossil resources will continuehas increased the amount of food waste recycled fromto play a major role in future energy supply in termstwo percent in 1995 to 95 percent today. The govern of managing and mitigating the impacts of climatement has approved the use of recycled food waste aschange, other natural resources will be neededfertilizer, although some becomes animal feed.to realize and facilitate progress in the creation ofrenewable energy. Improved energy efficienciesand decentralized power supplies will become moreimportant.31Scandalization of food waste Reasons for food waste on the part of consumers in 29clude increasing numbers of single households, poorConsumption-related resource usage shopping planning, misinterpretation of the use-bydate and inadequate storage and preparation. The EUIn the EU, around 88 million tons of food wasteaims to halve food waste by 2020 in order to secureare generated annually, 53 percent of the volumethe world's food supply, conserve resources (mate is wasted by households. The costs associated withrial and financial) and protect the environment. Thefood waste for the EU are estimated to be aroundFederal Ministry of Food and Agriculture launched an143 billion euros. Two-thirds of the costs are asso initiative against food waste (“Too Good for the Bin“)ciated with food waste from households. This largein 2016. In the mass media, waste due to misinter share is due to the expenses that accumulate alongpretation of the use-by date is the subject of discus the supply chain, such as packaging costs. The totalsion. “Containering“, food shops and food sharingamount of packaging waste is ever increasing due toinitiatives to pass on still good food are part of themore mobile consumption habits. For land use, mate cityscape in many places.rials and water consumption, the food sector has thelargest footprint of all demand areas, for CO2 it is themobility sector. Hot spots in online trading are mainlyCO2 emissions from returns and multiple trips.32Food losses and waste Globally, around one third of all food produced is30Re-use of food lost or wasted in production, post-harvest, process ing, retailing or consumer handling. Consumers inindustrialized countries throw away around ten timesThe world wastes more than 1.3 billion tons of foodmore food than in developing countries. In a worldeach year. Now South Korea is taking a lead, recyclingwhere millions of people are starving, this is a strong95 percent of its food waste. The South Korean gov indication of the inefficiency of current food systems.www.isi.fraunhofer.de

Food losses and waste often lead to economic lossessive. The preservation of the quality of food could befor farmers and other actors in the food value chain,enabled by new food storage techniques.as well as to higher prices for consumers. Both havean impact on food insecurity by making it more dif ficult for vulnerable groups to access food. Reducingfood losses and waste would increase the supply ofavailable food and strengthen global food security.35Climate change The impacts of climate change are expected to bemost adverse in low- and middle-income countries,33where millions of people depend on agriculture andStricter waste regulations are vulnerable to food insecurity. With regard to foodproduction, the sharp rise in meat consumption hasEach year around 20 percent of food produced in themassive impact on our climate. In 2015, world leadersEU is lost or wasted, causing unacceptable social, en explicitly acknowledged the need to address thevironmental and economic harm. EU is committed tothreat of climate change. They negotiated, under thesolving this problem and putting its food system ontoaegis of the United Nations Framework Conventiona sustainable path. In the revised EU waste legislation,on Climate Change (UNFCCC), the Paris Agreementadopted in May 2018 as part of the Circular Econ on climate change, which recognizes “the fundamen omy Action Plan, specific measures on food wastetal priority of safeguarding food security and endingprevention have been introduced which will providehunger, and the particular vulnerabilities of foodthe EU with new and consistent data on food wasteproduction systems to the adverse effects of climatelevels. The new waste legislation requires Memberchange“ (UNFCCC, 2015).States to implement national food waste preventionprograms and, importantly to reduce food waste ateach stage of the supply chain, monitor and report onfood waste levels.34New ways of food storage 36Hidden environmental impact ofconsumptionToday's consumption patterns are decisive for futuredisposal and environmental problems (e.g. materialdiversity and combinations). Consumption and envi The goal of any kitchen renovation is to create a func ronmental effects are often spatially decoupled, e.g.tional cooking area making the most of the space youin the case of active pharmaceutical ingredients in thehave at your disposal. Whether it is a redesign of yourdrinking water cycle and micro plastics in the oceans.current kitchen or increasing its footprint throughSome effects are also temporally decoupled. Theexpansion within or outside of the home, choosinglocation, distribution, nature and dynamics of suchthe right layout is important in meeting your family'screeping environmental effects are often only knownneeds. The drivers for food storage are among othersin isolated cases. Individual consumption patternsextreme seasonal climates worldwide, which causeare closely linked to traffic- and production-relatedradical changes in traditional agricultural character environmental impacts. The consumption patterns ofistics and might cause food shortages. Most peopleconsumers with high income cause by far the greatesthave probably thrown out food due to spoilage, butenvironmental impact.regularly doing this is terribly wasteful and expen 10 11

37Sustainable food for all governments, commercial organizations, and individ uals. The risks of unsafe food are substantial but canWith the rising global population, food availabilitybe difficult to quantify. In parallel with the increasingis an important need and an important challenge.size of the world population, consumer demand for aA sustainable food system is fundamental in solvingwider variety of foods is growing, entailing a longermany of the global issues, such as climate change,and more complex food chain. There is a need toland use, biodiversity and mass migration. Anotherrefocus attention and to reenergize commitments ondevelopment that needs to be highlighted in thisfood safety. Better data and methods are n

"Nutritional Food", "Designer Food", "Pharma Food", "Healthy Food", or "Wellness Food". 3 Vooking - vegan - gluten free More and more people stop eating meat for a variety of reasons. Many prefer vegetarian food for health reasons, for sustainability, but also for culinary pleasure. The VOOKING project develops a new