Much of the problem derives from a significant rise in demand for meat among the growing middle classes in emerging markets who previously could not afford it. Global total meat consumption has quadrupled over the past two decades and is expected to double in the next two. Improving sustainability in the meat and fish supply chain is therefore crucial. Robeco has engaged since 2016 with 11 companies active in the value chain, ranging from animal nutrition suppliers and meat producers, to fast-food restaurants and retailers covering the full supply chain.
Clearing land for cattle ranches to meet this higher demand for beef has led to extensive burning of rainforest land, particularly in Brazil. Land clearance for the production of palm oil – an essential ingredient in many foods and household goods such as shampoo – has also resulted in extensive deforestation to replace natural forest with high-value palm trees, and a massive loss of biodiversity. Robeco has engaged on all three issues, discussing rainforest destruction with the vice president of Brazil, employing satellite monitoring to watch for palm oil deforestation in Indonesia and Malaysia, and making biodiversity an engagement theme in its own right for 2020.
Plastic pollution is another growing problem, as millions of tons of plastics that are discarded in the ocean break down into microplastics that are eaten by fish and enter the food chain.
Other threats to the food chain include poor standards at salmon farms, insufficient checks that led to horsemeat being substituted for beef in Europe, and eating exotic animals such as bats which are believed to have caused the Covid-19 crisis.
Solutions include encouraging populations to switch to more vegetarian diets. This would make land use significantly more efficient, since on average a cow needs to ingest seven kilograms of plant protein through grazing a field to create one kilogram of animal protein in its body. Research indicates that the value of the ‘alternative meat market’ could grow tenfold to reach USD 140 billion in the next 10 years. It offers significant growth opportunities for companies in this space, with research showing that as many as 50% of US consumers are seeking more plant-based foods in their diet, and 40% are open to reducing their traditional meat consumption.