🍜 [#22] Food Security & Waste: A Misallocation Problem

🥣 Bowls overflowing for some, empty for others

Hello! Halo! Kumusta! Xin chào! สวัสดี! မင်္ဂလာပါ! ជំរាបសួរ! ສະບາຍດີ!

Photo courtesy of ARK Solves

🍜 If you’ve ever been to Indonesia, then you’ve likely tried the ubiquitous instant noodle brand, Indomie.

🦸🏻 Did you know that Indomie is also very popular in Nigeria though? In fact, they have their own marketing strategy leveraging superheroes called the Indomitables.

🤑 These products are affordable (a packet of 5 servings retails for USD1 on average in Indonesia), so widely accessible to consumers from lower socioeconomic strata and thus considered a staple for food security. But what’s the true cost of such food products? They’re not exactly the most nutritious nor environmentally friendly.

📊 The next section will explore the progress that we’ve made on food insecurity but how we’re still falling short, as well as how that interrelates with food waste and climate change…

🤔 What’s the deal with food security and waste?

🥣 Food insecurity means that there is inadequate access to sufficient food or food that doesn’t meet the standard quality of a person’s basic needs. Fortunately, it has declined meaningfully over time, especially in Asia…

📉 While there has been significant progress over the past few decades—with the prevalence of undernourishment developing countries ⅓ of what it was in 1970—it’s still a major global issue.

🥺 In 2022, 2.4 billion people around the world were moderately or severely food insecure. This translates to 3 out of every 10 people (FAO, 2023). The problem is most severe in sub-Saharan Africa, but other regions in the Global South are also vulnerable.

🌏 Zooming in on the Southeast Asian region, 111 million people were food insecure–16% of the total population. The Philippines is the most food insecure country in the region with around 50 million people who are food insecure–45% of the population (Business World, 2022). Most of these are the small scale farmers and fisherfolk who provide ⅓ of the world’s food needs. Climate change is only making them even more vulnerable.

❤️‍🩹 Malnutrition is another dimension to consider when thinking about food insecurity. Picking on Indonesia in particular, the share of the population facing severe food insecurity is quite low at less than 2.5%, however, the share of children who are suffering malnutrition is quite high at around 30-40% (Our World in Data, 2023). This is because not all calories are created equal and ties back to our opening message on food products like Indomie–while there might be plenty of availability, it might not be exactly the nutrition that we need for optimal health!

🟢 This duality exists in some part due to the The Green Revolution (GR), which though intended to tackle food insecurity also had its share of unintended consequences.

“The GR contributed to widespread poverty reduction, averted hunger for millions of people, and avoided the conversion of thousands of hectares of land into agricultural cultivation. At the same time, the GR also spurred its share of unintended negative consequences, often not because of the technology itself but rather, because of the policies that were used to promote rapid intensification of agricultural systems and increase food supplies. Some areas were left behind, and even where it successfully increased agricultural productivity, the GR was not always the panacea for solving the myriad of poverty, food security, and nutrition problems facing poor societies.”

🧪 The GR relied heavily on policies that subsidized the use of chemical fertilizers and pesticides to stimulate agricultural production and achieve food self-sufficiency. This encouraged their overuse, which not only burdened national fiscal positions but also caused environmental degradation (ADB, 2021).

🚜 The related conventional agricultural practices that were championed in the 20th century have led to structural problems, some of which we’ve mentioned in our previous issue on sustainable agriculture:

  1. Monocropping: a practice of planting just one crop that colonization has left in the Philippines and other parts of the Global South. With only one crop, farmers literally have access to just one type of food and one revenue stream. In itself, it is not sustainable. It’s like having a grocery store with only 1 product to sell. Moreover, it means they have to import into the village all their food needs. 

  2. Monopsony power: In any one village in the Philippines there is only one buyer of rice, or corn or another type of cash crop. The buyer has leverage and sets the price. From a revenue standpoint, the farmer is limited.

  3. Farmer demographics & push towards urbanization: In the Philippines, the average age of a farmer is 59 years old. Yes, they are about to retire soon and it’s unclear who will farm after they retire. Their kids experienced hunger and hardship and would rather (if not already) migrate to cities to work for call centers or to another country to care for other families’ kids or elderly. So the question is, who will produce our food in the future?

  4. Synthetic fertilizers and pesticides: these chemicals were touted to “increase yield” and thereby income which got farmers excited, especially since the government subsidized or handed them out “for free”. The yield increased at first but it fell shortly thereafter because the pesticide killed everything in the soil including the microorganisms that plants need to absorb nitrogen and other nutrients. This created a dependency for farmers to keep buying synthetic fertilizers and pesticides which is a death knell. Because these synthetic inputs are imported from afar, are by-products of crude oil, and are traded in the global capital markets, they are expensive. Farmers have to borrow money at high interest rates (20% at least) just to buy them. It dramatically increased farmers’ production costs leaving them with very little income. For rice farmers it is about $500/hectare for one cropping which takes 3-4 months. Assuming a farmer is able to do two croppings, it gives a farmer $1,000 of income for the entire year, which is barely $3/day – not enough for a family of 4-5. This leads to food insecurity that causes burning down of forests. Unless we help create a path for farmers to get out farming using synthetic chemicals, many of them who could farm would not be able to because it is so expensive and they would be in the red. In 2022, when Russia invaded Ukraine and caused the prices for both crude oil, and its by-product, synthetic fertilizers to sky rocket, many rice farmers in the Philippines did not farm rice at all. The fall out of this was a rice shortage in the summer of 2023.

❗ These structural issues all contribute to a highly vulnerable state of food insecurity.

🚮 Lastly, you might be surprised to know that we’re currently facing both large scale food insecurity and food waste. The co-existence of both implies that there’s a misallocation problem. According to the 2023 edition of the State of Food Security and Nutrition in the World report, between 691 and 783 million people faced hunger in 2022, representing an increase of 122 million people compared to 2019 (UN, 2023). In the face of this food insecurity, the irony is that one third of food produced for consumption globally has gone to waste; this amounts to about 1.3 billion tons per year, worth approximately US$1 trillion (WFP, 2020).

🥄 This wasted food can feed up to two billion people, which is more than twice the number of undernourished people across the globe—and if wasted food were a country, it would be the third-largest producer of greenhouse gasses (GHG) in the world, after the USA and China (WFP, 2020). So it’s not only increasing food insecurity in developing countries, it’s also contributing to the climate crisis.

♨️ As we mentioned in our 2nd issue on organic waste, food waste contributes significantly to landfill waste, and food waste in landfills decomposes to create methane (CH4), which is a GHG with 28 times more global warming potential compared to carbon dioxide over a 100 year timeframe (MIT, 2024). Aside from CH4 there’s also the issue of the Scope 3 emissions that are affiliated with the cultivation and transportation of the wasted food. Food waste can occur more upstream when food is brought to market due to poor logistics (e.g. lack of cold-chain) Likewise, it can also occur more downstream due to restaurants, hotels, etc. overbuying / not planning their inventory correctly.

🤖 In the next section, we feature an innovator who is tackling this very problem through an AI-based food waste solution…

📚 Want to learn more about this topic?

📢 Shout-out to Lumitics!

🗑️ Food waste is one of the world’s most overlooked environmental problem. Generating as much as 9 billon tonnes of CO2 emissions a year (Carbon Brief), there is so much more that needs to be done to curb the massive amount of food waste and by extension CO2 emissions generated.

🤖 Lumitics is a Singapore AI Food Technology start-up that empowers hotels, airlines and large commercial kitchens with an AI smart food waste tracking solution to help them reduce their food waste, cost and environmental footprint. Their AI Smart Food Waste Tracker, Insight, uses sensors and our proprietary image recognition technology to enable kitchens to seamlessly measure and track all food waste thrown away in kitchens. The data collected acts as a feedback loop to empower kitchens to make better decisions in their procurement and production thus minimizing their food waste.

🛎️ International hotel chains like Accor, Hyatt, Marriott, Four Seasons are taking a strong stance on tackling food waste and Lumitics has helped them see on average 40% reduction in their food waste.

❓ To learn more about them, check out their website.

🗞️ Recent News

🎙️ Interview with Ayesha of ARK Solves

…The problem being that farmers in the Philippines and other parts of the developing world are struggling to feed their families. I found this incredibly wrong because these are the very same farmers who feed the world the food we cannot live without.

Ayesha Vera-Yu, CEO & Co-Founder of ARK Solves

💡 Why were you initially inspired to tackle food security?

💸 In 2006, while I was still an investment banker my mom asked me to restructure the family farm in the Philippines.

🧑🏻‍🌾 It was during that time that I discovered my love for farming and also a huge problem. The problem being that farmers in the Philippines and other parts of the developing world are struggling to feed their families. I found this incredibly wrong because these are the very same farmers who feed the world the food we cannot live without.

💡 But I believed there is a solution. Because a generation ago during my grandparents’ time, farmers had diverse meals and could feed their families. In one paddy, my grandparents grew fish and ducks alongside the rice while the paddies were surrounded by vegetables. But the current system of farming that is focused only on 1 cash crop (monoculture) and dependent on synthetic inputs (fertilizers and pesticides) that are expensive, pegged to the dollar, imported from afar and deaden the soil, makes families hungry and malnourished.

💚 We have only one life to live. I have a unique standing – I grew up in the Philippines, studied biochemistry and developing world politics, and have amassed valuable skills from investment banking and my MBA. I decided to deploy my skills and experience to fix this painful problem and make sure all of us have access to food, health, and a sustainable future.

🛠️ How exactly is ARK Solves solving it?

🚀 ARK has a proven behavioral-change and market-driven program called Feed Back that is securing food, health and income in just 16 weeks. It is a community-wide vegetable exchange that inspires families to farm their food needs in their backyards, and to produce excess which they bring to the exchange or sell to neighbors or nearby villages. By 16 weeks or program end, families are food secure. Malnutrition is gone. Families have a new vegetable venture that brings them weekly income and increases cash flows by 25%! Communities are happy, united and have become the new suppliers of nourishing and affordable food for their area.

🌱 Through Feed Back, farmers return to their sustainable traditions, and relearn to save seeds, and make their own natural inputs again including compost and pest deterrent concoctions. They also relearn intercropping, companion planting and other techniques that bring back diversity, and increase soil health and productivity.

👨‍👩‍👧‍👦 Families continue to grow their garden and sustain their impact even 3 years after the program ended. These gardens not only provide food, it continues to absorb carbon! Since they don’t need to buy food in town, they also slash their carbon footprint. Lastly, since farmers and fisherfolk are no longer hungry, they no longer resort to burning forests or dynamiting seas. Instead, they have reclaimed their original role as protectors of the land and sea.

😲 What is a surprising fact about food security?

🧺 The surprising fact is that farmers who feed us are themselves hungry. Moreover, smallholder farmers collectively have a huge impact on climate change.

🎬 What actions can readers take now to support your cause?

Readers who want to solve hunger and slash carbon for good can:

  1. 🤝 Co-invest alongside a community. $25 will secure 1 family’s food for life, while $7,500 can make a community self-sustaining forever (arksolves.org/invest).

  2. 🏆 Champion ARK. with your corporation: [email protected]

  3. 👯 Join the team. In the past 3 years, we have scaled to 77 communities in 8 provinces where we have transformed 138,000+ lives. With a tested scaling plan, we are poised to bring Feed Back throughout the Philippines and other parts of the developing world. 

🦸🏻 What do you do when you’re not saving the world?

Be with my family, hike 🚶🏻‍♀️, read 📖, sleep 🛌🏻, do something wild and fun.

⏭️ Next week, we’ll be covering land use, which is a major source of greenhouse gas emissions in Southeast Asia particularly, so stay tuned!

❓ Did you enjoy this week’s issue? If yes, please do forward to your friends who would enjoy the read as well. Also, feel free to let us know what you thought by giving us feedback at [email protected].

🌊 SEA you next week!

Karina & Massimiliano