Triple Dividends from Linking Food Loss and Waste Reduction with Circular Agriculture: An Apec Perspective

Triple Dividends from Linking Food Loss and Waste Reduction with Circular Agriculture: An Apec Perspective

Published: 2021.06.30
Accepted: 2021.06.28
6
Institute of Economics, Academia Sinica, Taiwan

ABSTRACT

Food loss and waste (FLW) is a complex issue, occurring at various stages and involving various actors along the food supply chains. Since the call of SDGs in 2015, reducing FLW has been listed as the third target in the Sustainable Development Goal (SDGs) 12 “Responsible Consumption and Production.” The SDG 12.3 urges countries to halve per capita food wastes and reduce post-harvest losses by 2030. Attention to the issue has been made worldwide at various scales including global, regional, and national levels. The Asia-Pacific Economic Cooperation (APEC) region is the first region that put the reduction of FLW in the APEC food security roadmap in 2014 when the SDG had not been announced and committed globally. The target stated as “APEC economies strive to reduce FLW by 10% compared with the 2011-2012 levels.” Furthermore, there is a widespread concern that the impact of COVID-19 pandemic has exposed the structural weaknesses of the current APEC food systems. Disruptions in supply chains from lockdowns, labor shortages, blockage on transport routes, transport restrictions and quarantine measures and the closure of schools, restaurants and hotels, etc. have caused significant increases in FLW in many economies. Calls for changes are on the horizon. Reducing food losses and wastes in the APEC region may generate triple dividends. Besides creating economic value and new jobs, it avoids lots of greenhouse gas emissions, reduce waste of freshwater use, and recover meals for food security. Moving toward a circular agriculture presents an attractive model that works to increase the resilience and diversity of food systems. Based on the FAO and World Bank’s reports, tackling the problem calls for a mixture of strategic measures, such as collaboration throughout the supply chains, cross-border movements for emergency services and cargo flows, and adoption of digital technologies through public-private partnerships. Moreover, the action of circular agriculture means the food recovery hierarchy which includes food redistribution, diverting food scraps to animal feeds or organic fertilizers, anaerobic digestion, and composting. Beyond building better supply chains to secure food supplies, circular agriculture also enhances the health of the soil, improves productivity of carbon sequestration, and guarantees decent livelihood for farmers. With the vision to reconcile climate and carbon neutral targets with goals on FLW reduction, the transition to circular agriculture is now more relevant than ever since it helps create a food system that is resilient to shocks while delivering positive outcomes for the economy, environment and ecology.

Keywords: Food Loss and Waste, APEC Perspective, Circular Agriculture, Triple Dividends.

INTRODUCTION

Food loss and waste (FLW) is a complex issue, occurring at various stages and involving various actors along the food supply chains. According to the United Nations Food and Agriculture Organization (FAO) report, the world’s population will reach 9.1 billion people in 2050. At the same time, there must an increase of 70% of food production compared to 2005/2007 to deal with demand for food in the future. In the details, the production of grains must rise from 2.1 billion tons to 3 billion tons, the meat production must increase from 200 million tons to 4.7 million tons (FAO, 2013). In the food losses and waste, FAO predicts that, roughly one-third of the edible parts of food produced for human consumption gets lost or are wasted globally, which is about 1.3 billion tons per year. It is representing enough food to feed the estimated 1 billion people around the world that are food insecure, and resulting in the waste of labor, water, energy, land and other resources used in producing that food.

According to reports, the annual GHG emissions associated with the food lost and wasted in 2011 is 3.3 gigatons and could grow from 4.4 gigatons in 2010 to 6.2 gigatons in 2050 (Searchinger et al., 2018; FAO, 2013). Furthermore, the food loss and waste generated about 8% of global greenhouse gas emissions, it would be the third-largest emitter after China and the United States. In 2007, FAO estimated the total food wastage of water resource is 250 km³ and the land use almost 1.4 billion hectares in global (FAO, 2013). Moreover, the global annual market value of food loss and waste is around $940 billion.

In 2015, the UN members committed to support the Sustainable Development Goals (SDGs) after the Millennium Development Goals (MDGs). In SDG 12.3, the UN members call on the governments, members of the private sectors and individuals to “halve per capita global food wastes at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses” by 2030. At present, there are 200 million undernourished people in the world. Therefore, it is extremely important to increase efficiency in the supply of food. The key to do that is to reduce post-harvest losses in the production chain. Since the call of SDGs in 2015, attention to the issue has been given at various scales including regional, national and local levels. The Asia-Pacific Economic Cooperation (APEC) region is the first region that put the reduction of FLW in the APEC food security roadmap in 2014 when the SDG had not been formally announced and committed.

Furthermore, there is a widespread concern that the impact of COVID-19 pandemic has exposed the structural weaknesses of the current APEC food systems. Disruptions in supply chains from lockdowns, labor shortages, blockage on transport routes, transport restrictions and quarantine measures and the closure of schools, restaurants and hotels, etc. have caused significant increases in FLW in many economies. For example, Canada increases over half a pound of food waste per week per person during the pandemic.[1] The United States food-waste ratio is expected to rise and public policy and attention are needed to reduce it[2].

APEC economies are home to an estimated 2.9 billion people, accounting for 39% of the global population. This paper presents the dividends from reducing FLW with circular agriculture in the APEC region based on the report of a multi-year APEC project aiming at strengthening the PPPs on reducing post-harvest losses and food wastes along the supply chain. The project was implemented during 2013~2018. Three expert consultations and five capacity building workshops were held to share experiences on the adoptions of innovative technologies and best practices from both public and private sectors. A high-level policy dialogue meeting was held in June 2018 to promote good measurement and further investments in infrastructure for reducing FLW in 21 APEC member economies. These often require policy partnerships between public and private sectors (PPPs), particularly in developing countries and emerging markets.

REDUCING FOOD LOSSES AND WASTES IN THE APEC REGION

The term “food losses and wastes” refers to food lost or wasted during the process of handling of crops at harvest time, packaging, transporting, processing, marketing, and food preparation, and finally the purchasing and consumption of food by consumers. According to the FAO (2014) definition, food loss (FL) is defined as the decrease in quantity and quality of food, and food waste (FW) refers to the removal from the food supply chain which is fit for consumption, by choice, or which has been left to spoil or expire as a result of negligence by the actors of the food system, but not exclusively the final consumer at household level. Moreover, the FAO (2014) defined the food loss and waste as a decrease, at all stages of the food chain from harvest to consumption in mass, of food that was originally intended for human consumption, regardless of the cause.

The target of reducing food losses and wastes in APEC region

In 2014, APEC members adopted “Improve post-harvest management to reduce loss” and “Strengthen regional cooperation to promote food security” as two of its three main directions for FLW reduction. At the same time, the APEC Ministerial Meeting on Food Security also adopted the “APEC Food Security Roadmap towards 2020,” and set a goal of lowering food losses by 10% compared with the 2011-2012 levels by 2020. That meeting established superior channels for communication and a cooperative framework in order to facilitate exchanges on agriculture technologies, information, and practical guidelines in order to achieve the overall food security policy goals.

It is worthwhile to mention that the 10% food losses reduction target that was specified in the APEC Food Security Roadmap is an average over all APEC economies. Specific indicator can be developed based on each economy’s situation. The 10% reduction goal is to be calculated as an aggregate figure coming across all economies, which means APEC is not forcing every economy to achieve a 10% reduction because APEC acknowledges that every economy has its own unique situation and may make differing progress towards FLW reduction goals. So the target is meant to encourage all member economies to compare their reduction results to themselves and to measure their self-improvement progress rather than comparing with each other. What APEC emphasizes is that an average of a 10% reduction in FLW should be achieved in APEC as a whole.

The measure and result of food losses and wastes reduction in APEC region

In the APEC multi-year project, the research team used the FAO’s mass flow model to calculate the FLW in APEC Region. The model divided FLW into five stages, which include: (1) Production losses, (2) Postharvest handling and storage losses, (3) Processing losses, (4) Distribution losses, and (5) Consumption losses. The formula for calculating the FLW at each stage of the food supply chain is shown in Fig. 1.


Fig. 1.  Formula for calculating FLW at each stage along food supply chain
Source: APEC-FLOWS website (2014).

 

According to the calculation of mass flow model, it was found that the FLW in APEC region had increased since 2007 (as Fig. 2). The FLW in 2007 was 630.07 million tons and reached 717.29 million tons in 2013, an increase of 13.84% over the five-year period.  Furthermore, if the calculation by five stages of FSC, as Figure 2 shows that, most of FLW came from the stage of production and the stage of consumption, but less of FLW came from the stage of processing and packaging. The average FLW in the production stage was around 197 million tons, the handling and storage 131 million tons, the processing and packaging around 67 million tons, the distribution stage 82 million tons, and the consumption stage was around 196 million tons. This means most of FLW come from our household consumption and production of food. Figure 2 also shows that, FLW in most of stages have been increasing.

Moreover, if the calculation by differentiated commodities of FLW (as shown in Table 1), the most of FLW in three commodities are Vegetables, Cereals, and Roots and Tubers. The average of vegetables loss and waste from 2007 to 2013 is 204 million tons, the average of cereals loss and waste is 168 million tons, and the average of roots and tubers is 106 million tons. Notably, vegetables and fruits increased each year. These results mean the FLW of cereals, roots and tubers, vegetables, and fruits will become more serious in future. Nevertheless, the most fewer FLW commodities are pulses and eggs, loss in pulses amounted to 3 million tons per year, while the loss in eggs was reported at 7 million tons per year.

TRIPLE DIVIDENDS FROM REDUCING FOOD LOSSES AND WASTES IN APEC REGION

In the APEC multi-year project, two surveys were conducted in 2017 and 2018 respectively to identify the existing government actions on reducing food wastes in the APEC region, and to investigate the role of PPPs in implementing these actions. The second FLW survey found that APEC member economies have implemented a variety of solutions to reduce post-harvest losses and food wastes which can be sorted into three main categories: (1) prevention solutions, which eliminate avoidable losses and wastes at the source, by improving cold chain infrastructure, adjusting packaging to increase the shelf life, changing customer behavior, and serving smaller portions at dining places; (2) recovery solutions, including support on food donation such as tax incentives, standardized donation regulation, matching software, transportation, storage and handling, liability protection, and food safety education; and (3) recycling solutions, under which unavoidable losses and wastes can be composted or otherwise recycled as food or animal feeds (Hsu et al., 2018).

According to the survey in 2017, only three member economies (Chile, Malaysia and Vietnam) followed the FAO definition of food losses and food wastes, while seven economies (Australia, Hong Kong China, Japan, Philippines, Singapore, Chinese Taipei and the United States) used their own definition. Another five economies (Canada, New Zealand, Peru, Papua New Guinea, and People’s Republic of China) didn’t have any definition on FLW. In addition, according to their own definition of seven member economies, we found that there are differences in the types of food wastes. For example, the definition of food waste in Australia and Hong Kong focused on solid food wastes along the food supply chains, while the Philippines only focused on the food wastes occurring at the stage of consumption. In contrast, the definition of FLW in Singapore is complex, as it includes food losses, food wastages, and inedible food.

The findings of the second survey not only reaffirmed the importance of PPPs in these actions but also supported the use of innovations such as temperature and water-content control systems, food quality control systems to further reduce post-harvest losses in the emerging economies. These findings further support the implementation of non-technological improvements and education/ training across the food supply chain, such as temperature controls and standardized cold chain handling procedures, which can considerably reduce food wastes in a cost-effective manner.  In line with these findings, one of the policy recommendations to the public officials was to collaborate with the private sector and civil society to investigate low-cost options that can be implemented quickly in their cold chains, dry chains, and other supply networks in order to strengthen the food system. Overall, the development of a cold chain system should go hand-in-hand with the PPPs because it not only benefits the stakeholders who develop and operate the system but also results in benefits for the local businesses and creation of job opportunities in rural areas. This enables communities in rural areas to stabilize income and improve their livelihood.

KMPG (2020) noted that, the mindset of the food losses and wastes with circular agriculture as the “Food Recovery Hierarchy” (Fig. 3), there most preferred to reduce the volume of surplus food generated, feed hungry people, feed animals, industrial uses, composting, and least preferred to landfill or incineration. Moreover, Ellen Macarthur Foundation (2019) reported that, if the circular model could be used for food in cities, cities could generate benefits worth US$2.7 trillion \ a year in 2050, reducing greenhouse gas emissions by 4.3 billion tons of CO2, and could save US$ 550 billion in health costs.

Kummu et al. (2012) estimates the dividends on reducing FLW through calculating the losses of FSC at the country level, the resources required to produce these foods, and the potential savings of food supply and related resources that could be made through a more efficient FSC. They converted food supply into kcal basis to quantify resource (water, land, fertilizers) usage for FSC. The results showed that there were around one quarter of the food supply (614 kcal/cap/day) lost within the FSC globally. The lost and wasted food accounted for 24% of total freshwater resources, 23% of total global cropland area, and 23% of total global fertilizer usage. In addition, the wastage of resources for food production is largely located in North Africa, West-Central Asia, and North America and Oceania.

In 2016, the ReFED organization in the United States published a roadmap on reducing U.S. food wastes by 20%. According to the roadmap, 27 prevention solutions, recovery solutions, and recycling solutions were adopted as cost-effective strategies on reducing food wastes and identify the resources needed for implementation at scale. Furthermore, the cost-effective strategies were selected by a four-step process which included: baseline definition, solutions evaluation, data analysis, and data validation. According to the ReFED report, these cost-effective solutions can create triple dividends by generating US$10 billion of economic value and 15,000 new jobs, avoiding 17,900 Ktons of greenhouse gas emissions, and recovering 1 billion meals per year of food donations to nonprofit organizations .

To estimate the dividends on reducing food losses and wastes in the APEC region, our APEC team used the methodology of ReFED and the results are displayed in Table 2.  It is shown that in APEC region, reducing FLW by 10% will create US$141,506 million economic benefit and generate 184,519 new jobs per year.  In addition, reducing 10% FLW can also avoid 163,398 Ktons of greenhouse gas emissions, and reduce 17,806 billion gallons of freshwater use per year, while recovering 36,528 million meals of food donations to nonprofit organizations per year. However, availability of capital, land, human resources and technologies is critical for the success of a cost-effective FLW reduction project. Therefore, it is suggested that the governments should best provide financial support on infrastructure such as roads, electricity, implement food safety- and hygiene-related standards/regulations, and facilitate training and awareness campaigns activities, which in turns would also benefit its development in terms of better opportunities for people.

CONCLUSION

According the FAO estimation in 2013, the 1.3 billion tons of food losses and wastes per year represents enough food to feed the estimated 1 billion people around the world. Furthermore, the food losses and wastes generated about 8% of global greenhouse gas emissions, wasted 250 km³ water resource and 1.4 billion hectares of land.  In 2014, APEC adopted the “APEC Food Security Roadmap towards 2020,” and set a goal of reducing 10% food losses by 2020. Notably, the target specified in the APEC Food Security Roadmap is an average for all economies. Specific indicator can be developed based on each economy’s situation. APEC encourages all member economies to compare their quantification results to themselves to measure self-improvement rather than compare their figures to other economies.

However, it is important to note that following these FLW reduction targets and guidelines may require more time and investments to implement them from voluntary to compulsory basis. In addition, it is also worth considering involving the stakeholders along the entire food supply chains may help to achieve cost efficiency and effectiveness. Most importantly, collaboration along the supply chain as well as with government agencies or NGOs, i.e., PPPs, can result in successful reduction of FLW and create incentives for each supply chain members to reach the SDG 12.3 goal.

Moving toward circular agriculture presents an attractive model that works to increase the resilience and diversity of the food systems. Based on the FAO and World Bank’s reports, tackling the problem calls for a mixture of strategic measures, such as collaboration throughout the supply chains, cross-border movements for emergency services and cargo flows, and adoption of digital technologies through public-private partnerships. Moreover, the action of circular agriculture means the food recovery hierarchy which includes food redistribution, diverting food scraps to animal feeds or organic fertilizers, anaerobic digestion, and composting. Beyond building better supply chains to secure food supplies, circular agriculture also enhances the health of the soil, improves productivity of carbon sequestration, and guarantee decent livelihood for farmers.

In summary, reducing FLW in APEC region may generate triple dividends. Collaboration along the supply chain and between different regions/countries, as well as with the partnerships between public and private sectors can result in a successful reduction via increased efficiency for each supply chain member. Besides creating economic values and new jobs, it will also avoid lots of greenhouse gas emissions, reduce waste of freshwater use, and recover meals for food security. Hence, it is recognized that there exists a range of “no-regret” solutions (or “win-win” solutions), which can be applied to move the FLW reduction forward and reach the next FLW reduction target in the APEC region in 2030.  With the vision to reconcile climate and carbon neutral targets with goals on FLW reduction, the transition to a circular agriculture is now more relevant than ever since it helps create a more efficient and sustainable food system.

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[1] Laura Brehaut, “Canadians may be wasting more food at home during COVID-19”. Access on 10/10/2020 from: https://nationalpost.com/news/canada/canadians-may-be-wasting-more-food-at-home-during-covid-19-new-report-suggests

[2] Foodtank, “After a Sharp Increase, the Rate of Food Waste May Be Slowing”. Access 10/10/2020 at: https://foodtank.com/news/2020/09/after-a-sharp-increase-the-rate-of-foo...

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