Food. A word that matters… FAO at the SPIEF-2021

The session “Transforming the Food Industry in a Post-COVID World” of the St. Petersburg International Economic Forum (SPIEF-2021), with participation of FAO in the framework of the business programme, covered the topics of transition to sustainable development models of the agri-food industry, ensuring adequate nutrition, and elimination of the negative consequences of the COVID-19 pandemic for agri-food systems.

The leitmotif of the discussion was the digitalization of the agro-industrial sector and the emphasis made on the innovative methods of management. The current behavioural tendencies of the domestic and world consumer markets were discussed. A significant part of the discussion was dedicated to assessing and reducing the ecological footprint of agricultural sector. 

Bradley George Jakeman, Co-Founder and Managing Partner of Rethink Food NYC Inc. moderated the session. After greeting the organisers and participants of the Forum, he pointed out the relevance of the discussion in the current times, adding, “5-10 years ago, many would be rather bored talking about food”.

“According to FAO estimates, in 2019, the last year before the pandemic, 690 million people on the planet experienced chronic hunger, almost one in every eight of its inhabitants. The COVID-19 pandemic could have thrown up to 130 million more people onto the famine zone,” outlined Oleg Kobiakov, Director of the Food and Agriculture Organization for the United Nations (FAO) Liaison Office with the Russian Federation.

FAO’s annual report “The State of Food Security and Nutrition in the World” is being prepared. The statistics for 2020 are still being refined but “it is already clear that the total number of people experiencing hunger will far exceed the 700 million mark, while the 2030 Agenda for Sustainable Development set an ambitious goal to eliminate hunger as a phenomenon by this time, and provide adequate nutrition to all mankind,” recalled the Director of the FAO Moscow Office.

“To achieve this goal, we need to reduce the number of people, who experience hunger globally, by at least 70 million annually over the remaining 10 years. Obviously, this cannot be achieved at the current pace, and it is in this regard that the UN Secretary-General António Guterres, at the initiative of FAO, announced the Food Systems Summit 2021, which is scheduled to be held in September 2021, as part of the High-level week of the UN General Assembly. Awareness of the role of food systems can be considered a quantum leap in understanding the functions of this critical sector of the economy, which is the world’s largest employer, for the global economy and society in general. In preparation for the Summit, national dialogues are being held. A significant national dialogue in Russia ended last week, the results of which will act as an example for many countries”.

“Despite the use of advanced technology, cultured meat and other synthetic products on the shelves, the major share of the world’s food is still produced naturally. New technologies need to be invested in refrigeration chains, food safety, and traceability (surely, not every pack individually, but the batches of products using blockchain technology). Finally, the largest and most accessible resource for eliminating hunger and ensuring food security is the reduction of food loss and waste, and the use of modern technologies will allow us to achieve that.”

“One can only applaud the Russian agroindustry, because 10 years ago the development paradigm of the Russian agroindustry was different and ensuring domestic food security was considered to be its primary contribution to the global food security. Today, Russia has turned into a global granary, becoming the main player and the largest exporter in the world grain market. We welcome this trend and count on its stability. Such a role also presupposes global responsibility,” concluded Oleg Kobiakov. “FAO expects that Russia will fulfil this mission responsibly in the interest of its people and all of humanity and will make a significant contribution to the elimination of the world hunger.”

In her information-rich and analytically polished speech, Victoria Abramchenko, Deputy Prime Minister of the Russian Federation, emphasised that ‘’the agri-food market, its stability and well-being directly affects the stability and well-being of citizens of all countries, and national security as well”. Noting that the global food market has been in a state of turbulence since 2020, she elaborated on the lessons that need to be learned “in the post-pandemic world”. 

Firstly, on a global scale, the supply of food products has witnessed a decrease, caused by lockdowns, the curtailment of production in many countries, caused, in particular, by shortages of seasonal workforce, and the introduction of stricter sanitary rules. Environmental disasters were also added to the picture, such as the drought in Latin America and the invasion of the desert locust in African regions.

Secondly, the pandemic has disrupted the stable supply chains. In Russia, for example, it became a necessity to increase the food supply in each region of the country.

Thirdly, there has been a change in consumer behaviour. “People began to cook at home and order food, which has led to an explosive growth in online shopping and the food delivery segment.” There is an increased demand for environmentally-friendly packaging, and a new trend for healthy foods has appeared,” emphasised Victoria Abramchenko.

A particular headache that manifested itself during the pandemic in Russia is vulnerability due to “import dependence on seeds, plant-protective products, and genetic material.” As a result, many states “began to consider enhancing their national security through import substitution.”

In addition, many people have lost their “usual source of income”, their purchasing power has declined, and food has become less affordable in general. The Government has developed measures to support low-income groups and help large families.

Lastly, there was an exuberant demand for some items such as cereals, oilseeds, vegetable oil, and sugar. This trend will continue for the time being.

In the current “post-pandemic reality”, what priorities does the Government define for the development of the agricultural sector in Russia? Deputy Prime Minister Victoria Abramchenko named a number of key areas for progressive and sustainable movement forward.

The process of digitalization has been moved to the first place. “The pandemic has accelerated the total digitalization of all areas of our life, and agriculture is no exception. Business is reducing its costs thanks to the introduction of robotics, artificial intelligence, and blockchain,” she stated. 

During the pandemic, awareness of the importance of ensuring sanitary and veterinary safety has increased. “Pandemic has taught us to quickly respond to the emergence of a new virus and the need to release additional protective measures such as new testing systems, and vaccines… This trend will continue going forward. Each state must create its own sanitary and veterinary shield, as veterinary safety ensures the safety of the entire food chain.”

The accelerated scientific and technological development is on top of the agenda. It is closely related to the import substitution, which, in turn, is dictated by the need for domestic genetic material. Finally, there was a “societal demand for new types of foods, including those created on the vegetable protein basis.” This trend “is closely related to global climate change, with the fact that the planet is losing the ability to use clean, fertile arable land; with the decline of irrigated agriculture less and less fresh water is available for irrigation. Therefore, the new approaches such as hydroponics will continue to evolve,” noted Ms Abramchenko.

Elena Baturova, Director of the Centre for the Development of Financial Technologies, Rosselkhozbank, spoke about the digitalization of agriculture and the introduction of innovative technologies in this sector. “Russia has a huge potential and information base in agro-biotechnological issues of the agricultural sector, but there is also an urgent need to popularise this area in order to attract more investment and engineering base,” she said. 

Measures to counter the COVID-19 pandemic and other epizootic and zoonotic risks were covered in the speech, given by Sergey Dankvert, the Head of the Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor). He pointed out the importance of controlling viral diseases of animal and plant origin, and also noted the preparedness of Russia for the risks of new viral infections. Sergey Dankvert indicated the effective measures taken in Russia at the beginning of the pandemic, such as electronic certification, regionalization of diseases, as well as their compartmentalization. He called for further diversification of suppliers and markets as the key tool for protecting against vulnerabilities in the production chain. “You cannot rely on only one exporter and only one importer,” concluded Sergey Dankvert.

Mohamed Badr Al-Sadah, Chief Executive Officer of Hassad Food Company, shared the difficulties and methods of solving problems, both traditional and related to COVID-19, in the field of agriculture in Qatar. He pointed to the geographic difficulties associated with Qatar’s desert, dry climate, as well as the limited resources required for optimal farming. Mohamed Badr Al-Sadah said that the only solution to these problems is the digitalization of processes and the introduction of innovative technologies.

Evgeny Lyashenko, General Director of EFKO Group, spoke about artificially obtained proteins and other artificially grown food. Such products are consistent with three main criteria of the food industry, i.e. a beneficial effect on human health, which becomes possible due to the regulation of the balance of useful elements in vegetable protein, as well as the absence of antibiotics in it, which are used in classical animal husbandry not only for therapeutic purposes, but also for the prevention of diseases and as growth stimulants; reduction of the negative impact on the planet’s climate in comparison with traditional methods of production of livestock products; and the main function of providing people with food.

Tom Szaky, Founder and CEO of TerraCycle, spoke about the disposal and recycling of food packaging materials. He called on everyone to “voluntarily switch to a new track”, a more responsible approach to new realities and trends in the sphere of recycling. Tom Szaky highlighted the importance of establishing separate recycling centers and general reusable approach in the packaging field. “We need to move from a linear approach to a cyclical one,” concluded the expert.

Alexander Shenderyuk-Zhidkov, Director, Sodruzhestvo, spoke about the main climatic challenges for the agricultural industry, as well as the methods for calculating its carbon footprint. He identified two main challenges for the industry, which are digitalization and ecology. Talking about the difficulties in calculating total hydrocarbon emissions from animal husbandry, he drew attention to the importance of creating a single calculation system for all participants in the production chain from farmers to fertilizer producers. His thesis is as follows: the proper level of systematization and use of modern technologies in calculating CO2 in the livestock sector can significantly increase the competitiveness of the Russian subsector in the world market.

Marc Carena, Managing Director of McDonald’s Russia, spoke about the importance of positive brand positioning as promoting healthy diet, consumer behavior, as well as the social association of various brands. Currently, not only the quality of products is the main factor in consumer preferences, but also with what social activities of the company the consumer associates this brand.

Picking up the topic, Jan Dunning, Chairman of the Management Board, President and CEO of PJSC “Magnit”, noted that a consumer takes into account the Sustainable Development Goals and has a positive attitude towards manufacturers who support their implementation.

Dmitry Mazepin, General Director, URALCHEM, speaking about the growth in the number of people with no access to adequate nutrition and the rise in food prices, called it “very dangerous scissors.” The head of the company emphasized the need to go beyond one niche and expand the sphere of influence of each participant in the agricultural industry. He shared the news about the beginning of cooperation with “Innopraktika” in the framework of the project to create an artificial protein from methane. Dmitry Mazepin, citing examples of India and African countries, spoke about investment opportunities in creating common platforms that provide small and medium farmers with information, cultivation technologies, fertilizers, and forecasting systems, as well as provide them with a stable sales market by connecting with buyers.

... The words of Viktoria Abramchenko can be considered the final chord of the session: “I want to encourage our and foreign businesses to invest in ecology, and smart agriculture. I believe that this is the future.”