The current linear food supply chain needs to be updated; it’s wasteful and harmful to the environment. Pivoting to circular economy practices can reduce waste and address food shortages, but a lack of awareness, complex logistics, and the investment needed can pose significant barriers, but change is possible.
This can be seen through many proven real-world success stories from companies such as Lavazza, Too Good To Go, Barilla, and Favini. Switching to a circular economy is not just about being green; it’s about being smart. Cutting down on food waste saves money and lowers our carbon footprint.
Challenges in the Current Linear Food Supply Chain
The current linear food supply chain has several problems:
Convoluted and inefficient processes: Disjointed and complex processes can slow down the traditional linear food supply chain, leading to delays in distribution, storage, and transportation. These inherent inefficiencies are wasteful, costly, and time-consuming. According to the Food and Agriculture Organisation (FAO), these system inefficiencies account for the loss of approximately 14 per cent of the world's food.
High Greenhouse Gas Emissions and Environmental Impact: The linear food supply model significantly contributes to global greenhouse gas emissions, deforestation, and excessive water consumption. The high waste means that more agricultural land and water resources are required than would be necessary with more sustainable models. The current wasteful practices are unsustainable and harmful to the environment.
Generation of Food Waste: The current food supply systems result in substantial food waste at all stages, from production to consumption. This waste exacerbates landfill issues and contributes to resource depletion. The United Nations Environment Program (UNEP) estimates that about 17 per cent of total global food production, around 931 million tons, are wasted.
Limited Resource Optimisation: Single-use resources are the norm in the linear supply model. Resources are extracted and typically used once, then discarded. This approach leads to resource scarcity and needs to be more sustainable. The Ellen MacArthur Foundation highlights that only 9 per cent of the current global economy is circular, meaning there is enormous room for improvement as most resources are not reused or recycled. Single-use plastics are a particular concern and are still extensively used for products such as takeaway cups, cartons, and food packaging. However, more sustainable alternatives to plastic cups and other items can be recycled or composted in special facilities.
Positive Impacts of Integrating a Circular Economy
Integrating a circular economy into the food supply chain has numerous environmental, social, and economic benefits. Carbon emissions are lowered, waste is reduced, and efficiency is improved, leading to long-term cost savings. However, consumer choices matter, and their behavior remains an essential factor in the success of any integration. Customers opting for sustainable products helps to push companies to adopt circular economy practices.
Examples of the positive impacts of circular economy integration in the food industry
Too Good To Go allows consumers to purchase unsold food via a mobile application. Surplus food from restaurants, cafes, and grocery stores is available at a discounted price, reducing food waste and promoting sustainability. Too Good To Go partners with food businesses with surplus unsold food at the end of the day, allowing them to sell surplus food on the mobile app. Consumers can browse nearby participating businesses using the mobile app and purchase surplus food at a reduced price, collecting their food directly from the local business during fixed time slots.
By 2023, Too Good To Go had saved over 200 million meals from being wasted and 500,000 tons of CO2 emissions globally. In addition, participating businesses can reduce losses due to waste by selling surplus food through the app. At the same time, consumers can buy food at a fraction of the original price. Consumers, businesses, and the environment are served by this initiative, which is a “win-win-win” situation.
Barilla and Favini. Barilla is a major pasta manufacturer that partnered with Favini, a paper company, to create Cartacrusca, an innovative new type of paper made from by-products of pasta production. The main pasta by-product is a bran residue from the wheat milling process, which is unsuitable for human consumption but has now been repurposed for paper production.
The Cartacrusca paper product is made up of 17 per cent bran residues, reducing the need for virgin cellulose by 20 per cent and lowering CO2 emissions by about 22 per cent compared to standard paper production. Cartacrusca paper products are used in renewable and sustainable packaging, high-end packaging, and internal documents. This approach benefits the environment and provides economic advantages through new revenue streams from previously considered waste materials.
In partnership with the University of Udine, the coffee company Lavazza diverts coffee grounds from landfill sites and recycles them to create a range of products. Their "Freshpack Recycling Program" operates in conjunction with TerraCycle (a company that specialises in recycling materials that others cannot) and allows Lavazza coffee pods (Freshpacks) to be recycled. This program has so far recycled over 156 million coffee pods, creating a range of products, including park benches and bike racks. Lavazza has also launched compostable coffee pods called Eco Caps. These pods are made with biopolymers, designed to break down in as little as six months when combined with food waste in composting facilities.
The above examples illustrate that the tangible benefits of adopting circular economy principles in the food industry outweigh any initial investment required. In addition to reducing waste and the environmental benefits, improving resource efficiency can offer significant cost savings. For example, repurposing by-products into new products or sustainable materials can create additional revenue streams and reduce disposal costs. As shown above, circular economy initiatives can open new business opportunities and markets.
These initiatives resonate with consumers, fostering brand loyalty and driving market demand for sustainable products and companies that integrate circular economy practices. Adopting circular economy principles can also help companies avoid issues with regulatory changes, such as restrictions on single-use plastics and other environmental policies pushing toward more sustainable practices.
Conclusion
The transition to a circular economy is an environmental imperative and a strategic business decision. As the above success stories demonstrate, adopting circular principles leads to waste reduction, cost savings, and potential new revenue streams.
These initiatives address the challenges of the current linear food supply model and create value for businesses and consumers while reducing the adverse environmental impact. Though the initial investment and logistical challenges may seem daunting initially, the long-term benefits far outweigh any costs. Companies that embrace circular economy practices enhance their brand reputation and future-proof their businesses against increasingly stringent environmental regulations. As environmental consumer awareness grows, businesses that fail to adapt risk being left behind.
