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Mondelez CEO: The Future of Food Features Plenty of Snacks



The food industry is being tested by shifting consumer tastes, new technology and global trade disputes. Those are among the issues on the agenda Monday in New York at the Wall Street Journal's Global Food Forum, which includes prominent players in the sector such as the chief executive of

            Mondelez International Inc.,


MDLZ -1.19%

The President of McDonald's U.S.A. and leaders from the U.S. Agriculture Department of the Food and Drug Administration.

Healthier Snacks Growing Faster: Mondelez CEO

The healthier snacks market is currently growing globally about 6% to 7% annually, Mondelez International CEO Dirk van de Put said. That is faster than the 4% to 5% growth among indulgent snacks, which still make up 80% of the market, he added.

Globally, consumers are snacking on more, creating opportunities for Mondelez, said Mr. Van de Put. Today, people are eating 2.5 snacks every day, up from two a day just a few years ago. Busier lifestyles are supporting the trend, he said.

Food makers have to distinguish between trends and behavior, said Mr. Van de Put. While consumers claim they want healthier products, they are still buying indulgent items. "He said there was a difference between what people say and what they do," he said.

Mr. Van de Put also said there is no reason for Mondelez and

            Kraft Heinz Co.

       it re-merge. Mondelez International was formed after splitting with the predecessor of the latter firm. "It still makes a lot of sense to go back together," Mr. Van de Put said. He said Mondelez wants to stay focused on its core snacking categories.

He added that the snack giant is trying to move faster to bring products to market by testing out new items in a few markets and building from there. One downside with the approach is it simply takes longer to scale products up amid the challenge of predicting consumer behavior.

The company has had misses with product development, he said, pointing to a high-fiber biscuit that took three years to create and didn't do well after lots of people weighed in. “We ended up with a camel designed by committee,” he said.

#MeToo Protestors Target McDonald's at the WSJ Event

Protesters focused on

            McDonald's Corp.


MCD 0.26%

as Chris Kempczinski, the company's president for the US, spoke at the WSJ Global Food Forum, chanting "Me Too McDonald's!"

In August, the fast-food chain said it was planned to train all employees at restaurants on workplace antiharassment matters after facing criticism about the issue.

McDonald's U. S. Some workers have also been referred to cases of alleged sexual harassment at McDonald's. President Chris Kempczinski said workplace anti-assurance policies are important to the company.


Photo:
            

        Gabe Palacio for The Wall Street Journal
          

“We have a responsibility to take action on this issue,” Mr. Kempczinski said previously.

McDonald's is now testing a plant-based burger made by

            Beyond Meat Inc.


BYND -1.05%

in Canada. Unlike other restaurant chains that have embraced plant-based alternatives, McDonald's isn't using Beyond Meat's name in offering, instead of calling it “PLT” for plant, lettuce and tomato.

“There is a customer expectation of what a McDonald's burger tastes like, ”Mr. Kempczinski said when discussing the company's evaluation of the new burger and potential suppliers.

The chain will take months before deciding if the test should be further expanded and if suppliers can meet the needs of the world's largest fast food companies by sales, he said.

Representatives of meat producers said they were ramping up marketing to underscore the difference between their cattle-made products and new meatless rivals.

"We want to be out there telling the truth," Jennifer Houston, president of the National Cattlemen's Beef Association. The trade group also wants legal limits on the ability of plant-based producers to call their products meat.

Mission Not Impossible

An early investor in plant-based meat company Impossible Foods says the next big market to target is China through the introduction of fast-food items like Burger Kings' Impossible Whopper. “Young Chinese consumers love new technology,” he said

      Paul Friborg,

       CEO and chairman of Continental Grain Co., an investor in Impossible Foods. According to Mr. Friborg, who is also a board member of Burger King parent company Restaurants Brands Inc., an introduction to Impossible Whopper in St. Friborg. Louis implements the concept for the product. “There were lines out of restaurants.”

Startups Left Out of the Farm Deal Spree

Over the past four years, the agriculture sector giants have spent tens of billions of dollars on mergers targeted at cutting costs and streamlining innovation. As a result, startups are being overlooked, he said

      Kiersten Stead,

       managing partner at venture firm DCVC Bio Data Collective.

“Because they're going through this big consolidation spree, they're not being as acquisitive as we'd like them to be,” she said, lamenting the $ 1.6 billion measure

Kiersten Stead, managing partner at venture firm DCVC Bio Data Collective, said venture capital investors are getting deep into the agricultural supply chain.

            
        Gabe Palacio for The Wall Street Journal
          

Ms. Stead said venture capital investors are getting deep into the agricultural supply chain. Her firm has backed a startup that is working to help crops like rice and corn produce their own nitrogen fertilizer, and she said the goal is to transform the $ 180 billion fertilizer market. Such products will only get adopted if the commercial rationale is strong, she said. “You Need To Help The Farmer Make More Money.”

      Sanjeev Krishnan,

       chief investment officer and managing director of S2G Ventures, which invests in food and agriculture, said its firm is betting on products, including perishable goods, that are typically sold at the perimeters of groceries, such as fresh fruit and vegetables, yogurt, cheese.

He said that part of the store was growing two times faster than the center of shops, where retailers usually offer packaged goods. He added that there was often less competition among products sold along the perimeter, and that supply chain complexity created a barrier to entry.

Milk: Got Competition?

National Milk Producers Federation CEO

      Jim Mulhern

       said that plant-based beverages, which have been getting a lot of attention, will continue to grow, but a bigger hit to the dairy industry over time has been bottled water. Decades ago, it was not normal consumer behavior to buy a plastic bottle of water, he said, but that is a commonplace purchase now.

He added that the battle for supermarket shelf space between traditional cow's milk and almond, soy and other plant-based milk rivals may turn in part on dollars. While plant-based milks make up anywhere from 8% to 13% of the overall market, Mr. Mulhern said the “dirty little secret” of alternative products is that they “pay for that footprint” via stocking fees that secure preferred placement in dairy sections.

      Jessica Almy,

       

Jessica Almy, policy director for Good Food Institute, policy director for Good Food Institute, which promotes plant-based products, said plenty of traditional dairy brands similarly pay for grocery store space. , which promotes plant-based products, said a lot of traditional dairy brands pay for grocery store space.


Photo:
            

        Gabe Palacio for The Wall Street Journal
          

More Automation Is Coming To Farms

A global population shift from rural areas to cities is making it difficult for farmers to find workers, and pushing them toward automation, said

      John Stone,

       a senior vice president at

            Deere

      
        DE 0.06%

& Co., which makes farm equipment. "The labor is already gone," he said. "The machines have to get smarter." Last fall, Deere began offering a new combine harvester that could analyze grain quality as it comes into the machine, he said.

Deere processes mounds of data from farmers, Mr. Stone said. The company collects that data through a cloud-based platform, developing it and pushing it back out to customers so they can use it in their businesses, he said. One challenge for the company, however, is gaps in broadband coverage in rural areas.

Abundant Robotics Inc. is creating the first combines to harvest tree fruit, an area of ​​agriculture that has been automated to date and is worth billions, said the company's CEO,

      Dan Steere.

       

The debate about the impact of automation has on jobs and employment can be contentious. But Mr. Steere said deploying such tech on farms “prevents food costs from rising dramatically.”

Dan Steere of Abundant Robotics and John Stone of Deere & Co. discussed Automation at the Global Food Forum.


Photo:
            

        Gabe Palacio for The Wall Street Journal
          

Closing a Food Gap

Lower-income communities often have less access to healthy foods, and the role that can play in causing obesity and other health issues is the target of research at the College of Agriculture, Health and Natural Resources at the University of Connecticut, said Indrajeet Chaubey, dean of the college.

"There's no one magic bullet," he said, referring to the WSJ Global Food Forum's guidelines. Mr. Chaubey said UConn's research is focusing on how to alleviate these problems in the local community around Hartford, Conn.

Crop Prices Force Change

Low crop prices this year are pushing farmers to fundamentally change their point of view in order to survive in a tough agriculture economy. “Low commodity prices are causing farmers to think outside the way that they normally think,” said Sanjeev Krishnan, chief investment officer of S2G Ventures, which invests in food and agriculture.

Because farming is a high volume market with low profitability "The thinking must change the view of the business in terms of profitability per acre instead of yield," said Mr.

Low crop prices this year are pushing farmers to fundamentally change their point of view, said Sanjeev Krishnan, chief investment officer of S2G Ventures, which invests in food and agriculture.

            
        Gabe Palacio for The Wall Street Journal
          

Technology Can Help Reduce Water Use

One Way That U.S. farmers can wrestle further profitability out of their crop acres is to further embrace genetically edited crops — these plants “being able to provide traits…. reducing the inputs needed for farmers, ”said Peter Beetham, co-founder, president, and CEO of Cibus, a biotechnology company specializing in genetic modification. Mr. Beetham said that by creating strains of crops that are more disease-resistant and more efficient in their water consumption, farmers can not cut significantly into the cost of maintaining their acres, using less pesticides and water.

Ertharin Cousin, a fellow at Stanford University, said “the challenge of water is always local.”


Photo:
            

        Gabe Palacio for The Wall Street Journal
          

Technology is coming into focus to reduce the amount of water used across the entire agriculture system, he said

      Ertharin Cousin,

       a visiting scholar at Stanford University's Center for Food Security and the Environment. Businesses are seeking to utilize less for transporting produce and also reduce the cost of desalination, she said. “The challenge of water is always local,” Ms. Cousin added.

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