Exploring our Global Future: KPMG Agribusiness Agenda vol. 2

Exploring our Global Future: KPMG Agribusiness Agenda volume 2

Ian Proudfoot – KPMG Global Head of Agribusiness
13th November 2014

New Zealand’s primary sector must grapple with a range of global forces impacting food production – if it wants to remain relevant to the world’s agri-food markets of 2050, reports KPMG New Zealand.

That is the key message of the just-released Volume 2 of the 2014 KPMG Agribusiness Agenda, titled “Exploring our Global Future”.

KPMG’s Global Head of Agribusiness, Ian Proudfoot, says the report identifies key themes that will influence the future of agri-food demand and production. The critical challenge for New Zealand companies is to stay relevant to their customers in a world that is “undergoing unprecedented change”.

“In this report, we have set out to explore the macro trends that are expected to shape the political, social, environmental and economic outcomes for the global community over the next 20 to 30 years. We have identified 14 key trends that are likely to have the greatest influence on our global future.”

“The aim is to challenge the agri-food sector to think beyond the bounds of their immediate circumstances…and scan the global horizon for new opportunities and threats.”

The starting point is the rapidly changing geopolitical landscape, which is seeing the “wealth pendulum swinging back East” as many Western economies struggle to adjust to the post-GFC landscape.

Another key trend is the emergence of important new consumer groups – resulting from the growing middle classes in emerging economies, the world’s ageing population, and the increasing number of adherents to major religions.

According to Ian Proudfoot: “New Zealand producers should be exploring ways to tailor their food products to cater for the ageing population, for instance, or meet the growing demand for religious-based diets. By 2050, 40% of the world’s population (around 3.6 billion people) are expected to be eating in accordance with religious practices – and this will permeate throughout the global food supply chain.”

According to the report, the types of foods we eat may also look radically different in 30 years’ time.

Spiralling healthcare costs are increasing the focus on maintaining wellness rather than curing illness, driving demand for nutraceutical foods, a prime opportunity for New Zealand producers. Companies should also be exploring opportunities to take leadership roles in the development of synthetic or laboratory-grown foods, to complement our natural food offerings. We also need to recognise the foods we eat today will evolve, the report notes Insect-derived proteins as an example of products that due to cost and production efficiency are likely to breakout from ethnic diets into the mainstream over the next 20 years.

As the world’s population continues to grow – and resources become increasingly scarce – New Zealand producers can look to capitalise on our natural resources. It could also require us to re-think some traditional products.

“In a water-constrained world, people may not have access to fresh water to constitute dried milk,” says Ian Proudfoot “leaving the milk powder segment ripe for innovation and disruption.”

“This should be focusing companies on developing new fresh and shelf-stable products liquid products that are easy to transport with unique nutritional properties.”

Food integrity is another hot topic for many governments, particularly those in emerging economies, where many consumers have little trust that the product they are sold is what it is claimed to be.

“There will be a far greater global focus on food integrity; with many countries establishing specialist units within their police force, or creating new agencies to provide their communities with assurance over food safety. We expect to see a global food integrity body emerge, responsible for cross-border criminal investigations into food fraud.”

The report also addresses the failings of the agri-food system, noting over 9,000 children continue to die globally every day from malnutrition. “Even though New Zealand companies can’t feed the world, every company can make a contribution to addressing these issues, whether it is focusing on their food waste or enabling their technology and knowhow to be used in development projects.”

The attached Agribusiness Agenda explores these and other issues in depth.

About KPMG New Zealand
KPMG is focused on fuelling New Zealand’s prosperity. We believe by helping New Zealand’s enterprises succeed, the public sector do better and our communities grow, that our country will succeed and prosper.

KPMG is one of New Zealand’s leading professional services firms, specialising in Audit, Tax and Advisory services. We have 825 professionals who work with a wide range of New Zealand enterprises – from privately owned businesses, to publicly listed companies, government organisations, and not-for-profit bodies. We have offices in Auckland, Wellington, Christchurch, Hamilton, Tauranga and Timaru.

Globally, KPMG operates in 155 countries; employing more than 155,000 people in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (”KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

ENDS

© Scoop Media