Food and agribusiness consultant Mary Shelman told delegates at the Department of Agriculture’s open policy debate on the future direction of the industry last week that there are currently four key trends impacting agriculture globally today.
Shelman, who was heavily involved in Bord Bia’s Pathways for Growth report in 2010, was outlining her vision of the future of Ireland’s agrifood sector. The 2010 report suggested that Ireland should adopt a strategy of developing a world-class agricultural industry by 2016 and set itself the goal of becoming the most efficient, most highly innovative food and drink country in the world. She said at the event that Ireland is unique in the world not because it has a strategy for its agrifood sector but that the strategy was developed with involvement of both private and public organisations all along the supply chain.
Shelman outlined that one of the continuing drivers of growth and opportunity for the sector is down to increased demand for food. She says this is coming from both income increases and population growth. But she warned that this demand has to be satisfied in a world with constraints, particularly on the water side.
She also highlighted that this is coming at a time of lower stocks in the world across the main commodities such as grain.
“Supply comes along in bumpy ways” she added and this is the main driver of volatility.
Chinese demand
The former Harvard professor says the biggest driver of demand growth has been and will continue to be China in the next 10 years. She told delegates that with 22% of the world’s population, its challenge is that it must feed these with less than 10% of the world’s land resources.
“Therefore it is no surprise that China’s food policy is critical,” according to Shelman. She added this drives the structure of the industry around the world.
Never before has production in China been so challenged, according to Shelman. She says that African swine fever has wiped out half of the Chinese pig herd.
“This is having an impact that will transform the protein industry around the world,” says Shelman. However, she says it depends on how the Government responds – it can import the protein or get its people to eat other proteins.
The new consumer
Shelman says today’s consumer is having an increasing impact on how food is produced on the farm. This is putting more demands on the products they want to eat. They want fresh, local and authentic, with a large emphasis on health. She says the industry has responded to this new type of consumer and introduced numerous products tied back to production systems.
She says food has to be “the freest of the free” and that meat is not sold or segmented by cut now but by origin or region or how it was fed. She says this has led to “tremendous fragmentation” and that “the growth in the market is on the premium side”.
However, she warns that the impact of this push to premium means that “yesterday’s premium has become the new standard”. She says this is driving shifts in consumption and the trend of sustainability – “consumers now expect it, require it, and it becomes the basic licence to operate”.
Shelman asks what all this means as the boundaries keep expanding. She believes that you cannot build sustainability into a product once it leaves the farm and that this is driving tighter relationships along the food chain.
Transformational technologies
Agriculture has been slow to adopt new technology but there is potential according to Shelman. She says this is happening at all levels of the value chain. Digitizing agriculture is about increasing productivity at farm level, says Shelman, be it making proactive decisions rather than having to wait to see if a crop has a disease or a cow has an issue so the output potential can be kept up. “We need to transform agri from an art to a science with technology” she says.
Shelman outlines that because agriculture had historically low growth, it wasn’t interesting to investors.
There has been huge growth of inward capital into the agri-food sector since 2012 as the sector becomes more interesting to investors. In 2017, 50% of the investment was coming from the US and 20% from China.
Key takeaways for setting a vision for Ireland agrifood industry into the future.
Continue the relationships and communication structure that has been in place to date. Continue to have everyone working to the same vision.Don’t chase scale – it’s really about differentiation.There needs to be farm-level programmes and proof of delivery.Supply chains must align and innovate to create differentiation to increase sustainability and secure licence to operate.
Food and agribusiness consultant Mary Shelman told delegates at the Department of Agriculture’s open policy debate on the future direction of the industry last week that there are currently four key trends impacting agriculture globally today.
Shelman, who was heavily involved in Bord Bia’s Pathways for Growth report in 2010, was outlining her vision of the future of Ireland’s agrifood sector. The 2010 report suggested that Ireland should adopt a strategy of developing a world-class agricultural industry by 2016 and set itself the goal of becoming the most efficient, most highly innovative food and drink country in the world. She said at the event that Ireland is unique in the world not because it has a strategy for its agrifood sector but that the strategy was developed with involvement of both private and public organisations all along the supply chain.
Shelman outlined that one of the continuing drivers of growth and opportunity for the sector is down to increased demand for food. She says this is coming from both income increases and population growth. But she warned that this demand has to be satisfied in a world with constraints, particularly on the water side.
She also highlighted that this is coming at a time of lower stocks in the world across the main commodities such as grain.
“Supply comes along in bumpy ways” she added and this is the main driver of volatility.
Chinese demand
The former Harvard professor says the biggest driver of demand growth has been and will continue to be China in the next 10 years. She told delegates that with 22% of the world’s population, its challenge is that it must feed these with less than 10% of the world’s land resources.
“Therefore it is no surprise that China’s food policy is critical,” according to Shelman. She added this drives the structure of the industry around the world.
Never before has production in China been so challenged, according to Shelman. She says that African swine fever has wiped out half of the Chinese pig herd.
“This is having an impact that will transform the protein industry around the world,” says Shelman. However, she says it depends on how the Government responds – it can import the protein or get its people to eat other proteins.
The new consumer
Shelman says today’s consumer is having an increasing impact on how food is produced on the farm. This is putting more demands on the products they want to eat. They want fresh, local and authentic, with a large emphasis on health. She says the industry has responded to this new type of consumer and introduced numerous products tied back to production systems.
She says food has to be “the freest of the free” and that meat is not sold or segmented by cut now but by origin or region or how it was fed. She says this has led to “tremendous fragmentation” and that “the growth in the market is on the premium side”.
However, she warns that the impact of this push to premium means that “yesterday’s premium has become the new standard”. She says this is driving shifts in consumption and the trend of sustainability – “consumers now expect it, require it, and it becomes the basic licence to operate”.
Shelman asks what all this means as the boundaries keep expanding. She believes that you cannot build sustainability into a product once it leaves the farm and that this is driving tighter relationships along the food chain.
Transformational technologies
Agriculture has been slow to adopt new technology but there is potential according to Shelman. She says this is happening at all levels of the value chain. Digitizing agriculture is about increasing productivity at farm level, says Shelman, be it making proactive decisions rather than having to wait to see if a crop has a disease or a cow has an issue so the output potential can be kept up. “We need to transform agri from an art to a science with technology” she says.
Shelman outlines that because agriculture had historically low growth, it wasn’t interesting to investors.
There has been huge growth of inward capital into the agri-food sector since 2012 as the sector becomes more interesting to investors. In 2017, 50% of the investment was coming from the US and 20% from China.
Key takeaways for setting a vision for Ireland agrifood industry into the future.
Continue the relationships and communication structure that has been in place to date. Continue to have everyone working to the same vision.Don’t chase scale – it’s really about differentiation.There needs to be farm-level programmes and proof of delivery.Supply chains must align and innovate to create differentiation to increase sustainability and secure licence to operate. 
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