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Addressing an emerging megatrend: Feeding a changing world

Posted on July 21st, 2016 by in Chemical R&D

Megatrend Food

Analyzing the impact of various megatrends on the future development of the chemical industry is becoming an important strategic tool. What are megatrends?

They’re drivers of change that have a global reach affecting all parts of the society and have a duration of two decades or more. Megatrends encompass fundamental changes that have concrete, lasting impact on the lives of people and on the economies of entire countries and world regions. Companies use megatrend analysis to identify areas of action, for example, how to direct investments or cut costs across divisions. Megatrend analysis provides managers a common framework when addressing business transformation. The list of current megatrends is extensive, revolving around environmental issues, resource scarcity (energy, agricultural land, clean water, and food), and changing demographics, as well as increasing mobility coupled with decreasing costs of information transmission.

Feeding the world is a particularly pressing megatrend. Growing economies, such as those of China and India, are generating higher incomes, better infrastructure, and increased consumer awareness. They will drive increased demand for agricultural products and for high protein foods like those consumed in the West. Because global population is estimated to exceed 8 billion by 2025, food sourcing and security will assume a higher priority in future international agendas. The Food and Agriculture Organization (FAO) estimates that global food production must increase by 70 percent over the next four decades to fulfill the needs of the world population. Experts forecast that meeting this challenge using current approaches will be all but impossible.

By re-aligning their organizational cultures and altering their product development cycles, companies in the chemical industry can better position themselves to provide solutions to a wide range of intensifying megatrend challenges. It’s already happening in several different sectors. Examples include the use of food-industry infrastructure to deliver healthcare; the application of resourcing for agriculture monitoring activities to support sustainable agriculture; and the incorporation of innovative technologies, such as the use of anaerobic digestion of food waste, to generate green energy.

Gelzen, Clara Foods, New Wave Foods and other companies are already commercializing the use of animal-free technology and molecular manufacturing to produce, in bioreactors, foods that were traditionally animal-based, such as milk, cheese, meat, gelatin and eggs. As an additional sign of the relevance of the feeding-the-world megatrend, multinational giants — including BASF, Bayer, Dow, DSM, DuPont and Evonik — are updating their mission statements to highlight their role in improving food production, enhancing health, boosting nutrition, and reducing crop wastage.

The increasing complexity and pace of change in a transforming world represent challenges to the chemical industry in all of its segments, from products and consumer goods to pharmaceuticals, biotech,  healthcare and other life sciences. Companies must adapt to be successful and remain competitive. They must respond with agility to develop new chemistries and molecules to meet rapidly evolving customer needs.

Challenges present opportunity. Chemicals companies can get the most value out of responding to megatrends by identifying what demand for chemicals, products, and technologies will result from them. Individual companies can also differentiate themselves through the specific structural and organizational changes they implement to extract advantages from megatrends.

All opinions shared in this post are the author’s own.

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