Food trends in conflict
SUSTAINABLE PROTEINS, VALUE FOR MONEY AND CONVENIENCE.
The global food system is the world’s largest industry, with close to 8 billion customers and about 10 percent of global GDP. Food affects everyone, and how food is produced, distributed and consumed affects the environment, social structures and health. Food is a necessity and a pleasure – as consumers we are on the one hand curious and our tastes change quickly, but on the other hand we are price-conscious and want comfort.
SUSTAINABILITY: BETTER PROTEINS
Food production today accounts for 25-30 percent of total greenhouse gas emissions, the majority of which are linked to raising animals. In addition, a breathtaking third of all food is wasted in various parts of the value chain.
Globally, total meat consumption is growbranding roughly in line with population growth. On the other hand, Sweden passed “peak meat” in 2016, and our meat consumption per person has since decreased slightly each year. Vegetarian protein alternatives, in minced, burger or other form, have gone from being a narrow niche for vegetarians, to becoming part of more and more carnivores’ diets.
The market for meat alternatives is expected to grow by almost 15 percent per year until 2025. If meat substitutes were to reach 10 percent share of global meat sales, it would mean a market of around SEK 1 trillion (milk substitutes have already taken 15 percent of the U. S. dairy market). Future prospects for alternative protein sources are what attract great interest from investors.
This protein shift is one of Axel Johnson’s investment company Novax’s focus areas, with investments in, among other things, Gårdsfisk’s cycle for aquaculture on farmland, Prolupin’s plant-based dairy products and agricultural inputs and in Svensk Baljväxtfärs, developed at Axfoundation’s experimental farm, Torsåker.
Within Axfood, Dagab develops 250-300 new products every year for Axfood’s own brands, with an increasing focus on vegetarian products, and with product launches of completely new protein sources, such as Cashewmeetly – a meat substitute made from cashew apples.
1/3 SHARE OF THE WORLD’S FOOD PRODUCTION THAT IS WASTED
In trend reports and analyses of the food industry and food tech, the focus is naturally on innovation – new technologies and behaviors. Perhaps that is why one of the most persistent movements in the food market is hardly noticed at all: the growth of discount chains.
When asking consumers the primary factors driving their choices, convenience and value for money are consistently ranked at the top. While nothing new, it is persistent, and in markets throughout the western world, low-cost players are gaining market share. It is also clear that low prices are of interest to a large proportion of households and in no way are limited to customers with tight household finances. With rising food prices and increased economic uncertainty, it appears very likely that price awareness will increase further, which is also strengthened by growing e-commerce.
Based on the ability to combine quality and price value, Willys has quarter after quarter managed to grow faster than the market by offering a wide range with both distinct low-price products and market-leading brands further up the price ladder, plus a large range with a sustainability profile.
Seeing the impact of price on purchasing decisions is central also from a sustainability perspective. There is undoubtedly a group of customers willing to pay more for sustainable choices, but in order to reach broad customer groups and to really have an impact on production, suppliers and businesses must offer sustainable food that defends its spot on the shelf on its own merits.
“So far, rapid deliveries are subsidized by venture capital.”
COMFORT: QUICK COMMERCE – HOW FAST DO WE NEED IT?
Home-delivered restaurant food had long been big in North America, but a marginal phenomenon in major European cities. In recent years, home delivery has grown exponentially, which can be seen just by looking around. In 2021, a similar trend in groceries grew, with a number of new players delivering within 15–30 minutes.
The average shopping cart for “regular” online food purchases is well below SEK 1,000. With quick commerce players, the average is a bit less than SEK 200, an amount that is difficult to deliver with profitability. So far, rapid deliveries are subsidized by venture capital in the struggle for customers and market shares.
So it remains to be seen how large the market really is for rapid food deliveries. What we can be absolutely sure of, however, is that customer expectations of speed and availability have shifted.