Cage-free, antibiotic-free, artificial-free. Sound familiar?
Many of the world’s biggest food companies announced major changes this year — in what they purchase and how they manufacture their food.
Many of the big moves we saw came from companies striving to bring more transparency to their supply chain. McDonald’s pledged to source chickens raised without antibiotics. Dunkin’ Donuts and Costco are switching to cage-free eggs.
Some companies signaled to customers that they were “cleaning up” and simplifying their ingredient lists. Panera ditched dozens of additives. Even Lucky Charms and Butterfingers are getting minor makeovers: General Mills and Nestle said they’re removing artificial colors and flavors from their products.
“Big Food is definitely feeling the pressure,” Scott Allmendinger, who consults with food companies for the Culinary Institute of America, told us. Packaged-food companies lost $4 billion in market share last year, according to a Fortune analysis.
A 2015 Nielsen survey found an increasing number of consumers say they’re willing to pay a premium for “all natural,” “clean” and minimally processed foods. (As we’ve reported, it’s hard to know what any of these terms actually mean. The federal government is soliciting input for how to define “natural.”)
And, it seems, these foods marketed as cleaner and more natural are blending into mainstream grocery stores. One example: the success of Kroger’s Simple Truth line of products, which focus on “simpler” and organic ingredients.
“Consumers are slowly migrating away” from the center aisle of the grocery store that’s filled with processed baked goods and canned foods, says Jack Russo, an analyst with Edward Jones, a financial advisory firm.
At the same time, the sales of foods marketed as “local” have surged to $11 billion a year. The organic and natural sector, including GMO-free and gluten-free, is growing at about 8 to 10 percent a year, says Russo.
Russo sees this trend continuing, with growth continuing in the 6 to 8 percent range for the next few years, he says.
Another issue that gained traction this year: the 133 billion pounds of food wasted in the U.S. annually.
To put a visual to this estimate, imagine filling a huge skyscraper such as the Willis Tower (formerly known as the Sears Tower) 44 times.
That’s the image that Agriculture Secretary Tom Vilsack used when he announced in October a new national goal to reduce food waste by 50 percent by the year 2030.
Everyone who eats could play a role in reducing waste. And we have plenty of moral imperatives to do it. As Pope Francis once said, some food waste is akin to “stealing from the table of those who are poor and hungry.” The Environmental Protection Agency has estimated that the typical American family tosses out about $1,600 a year in groceries.
There’s plenty wasted on farms, too, some of which is entirely unavoidable. But as we documented in this story, a lot of food isn’t harvested simply because it’s not quite up to our cosmetic standards. Often, bags of salad and plenty of other edible food items end up in landfills because they won’t stay fresh long enough to be shipped across the country. A number of NGOs and startups are trying to figure out how to get more of it into the hands of the hungry and the people happy to pay less for imperfect produce.
This year also brought some high-profile outbreaks of foodborne illness. If you’re a Chipotle stockholder, you’re probably well aware of the fallout.
As we’ve reported, Chipotle Mexican Grill is linked to two separate outbreaks of E. coli infections. The first outbreak sickened 53 people in nine states and prompted the temporary closure of many Chipotle locations in Washington and Oregon.
Then, in early December an outbreak of norovirus sickened at least 120 people in Boston, mostly students at Boston College. Most of the sick students reported eating at a nearby Chipotle.
As our colleague Dan Charles reported, city health inspectors cited Chipotle for allowing a sick employee to work his shift. In the violation report, the inspectors specified that the restaurant should follow its employee illness policy.
Though the Chipotle outbreak got a lot of attention, there are thousands of outbreaks of norovirus each year.
The CDC says norovirus is the leading cause of foodborne disease in the U.S. It’s estimated that about 20 million people a year get sick with it.
The vast majority of outbreaks are caused by infected workers. So, hopefully, the lesson learned in 2015 is this: Restaurants need to keep sick workers off the job.
The CDC estimates that 1 in 5 food service workers has gone to work while sick with vomiting or diarrhea. “It is vital that food service workers stay home if they are sick,” says the CDC’s Aron Hall. He says businesses should consider measures such as paid sick days.
Innovation And Investment In Food And Agriculture
While Big Food is hustling to keep up with changing consumer tastes and values, hundreds of new and nimble companies are entering the marketplace to compete with them. A report by the Dutch banking group Rabobank found that investment in food and agriculture is set to surpass $4 billion by the end of the year.
Rabobank thinks we’re headed toward a “smarter food system.” And plenty of companies and investors want to help us get there. How? Mainly, with technology and (big) data tools for both consumers and farmers.
Venture capitalists are excited about food and agriculture, too, and are pouring money into startups. Entrepreneur reported earlier this year that “startups all along the food chain — from farmers and tech companies to home cooks — are reaping huge rewards [from venture firms]: $2.06 billion invested in the first half of 2015 … nearly as much as the $2.36 billion total for 2014.”