April 20. 2022

What Pointers Are Transforming the Foodtech Industry In 2022?

Technology continues to change the gameplan in many industries worldwide, enhancing production, processing, conveyance, and delivery. That’s more pronounced in the most significant global industry, one that comprises about 10% of the world’s GDP, according to estimates by the World Bank. So, what developments, trends, market share, and cost analysis can give pointers on the Foodtech industry for 2022?

From farm to fork, technology is increasingly playing a part in the food industry, helping producers, manufacturers, and service delivery gain efficiency for a growing consumer base. That increase is expected to balloon in the coming years, with players adopting advanced innovations to help solidify their market footprint.

However, the Foodtech niche faces growing pains, including market challenges, product scope, growth rate comparison by type, and numerous consumption risks. Companies involved form a tiny portion of the agri-food industry but are meant to become the vanguard of the sector. Continue reading to find out if its potential can convince market analysts, especially after overcoming the significant influences of the current pandemic.

What Is Foodtech and Why Is the Segment a Vanguard of the Agrifood Industry?

Foodtech is the merging of the food industry and technology, involving, among others, projects and innovations in Artificial Intelligence or AI, the internet of things, IoT, and big data. It brings together entrepreneurs, tech innovation startups, service players, and other actors. The aim is to turn the agrifood segment from food production, distribution, and consumption into a more contemporary, efficient, and sustainable sector.

Highly innovative startups are in charge of the research and development that provides technological and creative solutions. These R&D projects aim to tackle the modern challenges and their repercussions on global food security. Such issues include population growth, climate change, food waste, environmental impact, lack of natural resources, and exceedingly digitized society.

By definition, Foodtech is divided into six distinct categories that include;

• Agricultural Technology: Agtech combines agriculture and innovation to herald futuristic farming techniques. These include urban and connected farms that deliver food to cities while reducing their environmental impact or footprint.
• FoodScience: FoodSci imagines and enables the production of tomorrow’s foods through research, creating modern, healthier food product alternatives.
• FoodService: FoodServ gathers startups that reinvent restaurant management with platforms for reservations, cash registers, and online service delivery.
• End-User Guidance: Advising services accompany and guide consumers in their purchases throughout the food cycle. That includes product quality transparency, personalized nutrition, culinary recipes, and dietary recommendations.
• Distribution and Supply Chain: Conveyance and grocery systems that deliver food ingredients, ready-to-eat meals, and meal kits that enable you to cook your measure. These range from retail intelligent and automatic distributors of groceries and door-to-door food deliveries.

Foodtech is an umbrella term that covers all technological and digital activities related to food production, processing, distribution, and consumption. Since the Covid-19 pandemic, the fast-growing sector has become highly dynamic and solicited. It also magnifies some of society’s habits while shaking up and creating others, including ordering food, strengthening product traceability, and reducing food waste.

Catalysts Shaping Transition to Innovation for the Foodtech Industry In 2022

By the end of last year’s quarter four, investments in the Foodtech industry had accumulated to 85% compared with 2020’s entire yearly performance. That’s remarkably down to a new boom in the market for fermented proteins, healthy food alternatives, and ready-to-eat meals. There are also trends driving the move towards climate-smart technologies disrupting food production, manufacturing, and distribution.

Although still in its infancy, the transition is fuelled by tailwinds of massive demographic changes that spur consumer demand. There’s also seismic activity caused by massive advancements in food production technology, creating new choices. Besides, venture capital seeks to fund these disruptive, high-growth startups spurred by environmental, social, and corporate governance or ESG.

Foodtech Drivers of Innovation in Food Production

If it’s the fourth industrial revolution, then innovation in farming needs to move from issues like nutrient-challenged soils and lack of access to capital. Alongside the increase in social and environmentally conscious investments, fintech, biotech, and robotics are the emerging propellants for change in food production.

While these are maintaining growth in 2022, curves promise to escalate for drivers of innovation in;

• Robotics increase efficiency while reducing overheads like labor costs across the food production system
• Digitization of farms with the help and implementation of ESG
• Transformation of agriculture and agritech by fintech, similar to its effects on the mortgage and student loan market
• Biotech, especially RNA technology that came through during the pandemic, applied to farming, saving soil nutrition

Supply Chain Disruptions Catalyzing Foodtech Innovation

Over the last couple of years, supply chain disruptions have catalyzed investors to fund innovation that drives Foodtech solutions. Governments, the private sector, and NGOs aim to make distribution more sustainable, less wasteful, localized, and agile through cellular agriculture, food waste solutions, and biotech.

Innovation revolutionizing Foodtech through supply chain solutions include;

• Fermentation to power alternative products and the next generation of protein nutrition
• Sustainable, safe food through cellular protein for global consumers
• Food waste solutions are recognized as essential tools for feeding the world, and good business practice adoption

Before the 2020-2021 pandemic, consumers demonstrated the desire for better nutrition choices, initiating a renewed focus on personalized food and healthcare. Foodtech startups are answering this need with cutting-edge biotech science, AI, and machine learning to develop functional nutrient-dense products.

Such catalysts include AI and machine learning platforms to unlock plant and fungi use cases and understanding. Biotech makes food the center of efforts to improve health conditions and eliminate chronic diseases. Grocers and food brands have to follow suit and personalize nutrition using Foodtech; otherwise, consumer apathy causes them to perish.

Consumer Trends Spearhead Change in the Foodtech Industry

Nothing increases innovation, developments, and funding in the Foodtech sector than how customers view food, digitized delivery, and personalized nutrition. People have also become more time-conscious, driving the tracking of orders and demand for user-generated food experiences. Brands then use consumer data sourced from these platforms, such as social media, to meet demand, engage and fuel innovative growth.

Foodtech companies and urban-dwelling professionals fuel the race for market share, and the startup ecosystem is segmenting and diversifying. These segments include grocery delivery, on-demand meals, personal caterers, box deliveries, etc. As consumers change preferences, FoodServ and Foodtech industries use innovative technology to deliver what they deserve and desire through;

Cloud Kitchens
The focus of Foodtech startups has shifted from their core delivery responsibilities to delivering lip-smacking meals at reduced prices. Low-budget restaurants and caterers have eliminated seating space for diners and instead concentrate on cooking and making doorstep deliveries.

Off-premise dining requires customers to make online orders via delivery apps or business websites to ghost restaurants that don’t have storefronts. There are lower operating costs, including rent and labor, while this allows Foodtech providers to diversify and expand their product consumer bases. Besides well-trained kitchen and delivery staff, operators invest in kitchen equipment, cloud technology, and platforms that improve customer acquisition.

Foodtech Robotics
The global Foodtech and FoodServ industries utilize over 30,000 robots to keep food fresh, ensuring availability, quality, and affordability. These machines also perform tasks that aren’t human-centric, improving safety and hygiene while saving time and space.

Foodtech robots have high consistency, accuracy, and speed levels, when repetition is required for processing, packaging, dispensing, or filling orders. Others operate in baking and meat deboning or cake decorations, while vision systems sort food products according to shape, color, or size.

3D Printing
With 3D printing technology, the foodtech industry leverages its innovation to produce distinct edibles from drinks to pizza. Using melted plastics that solidify quickly, pre-loaded recipes are customized by shape, color, flavor, or nutritional content to create culinary art. Raw ingredients are bound with edible cement to design new shapes that add visual appeal and increase sales.

As such foodtech operators cut costs drastically, and they can meet their customers’ needs. Such instances include fulfilling the demand for gluten-free and vegan foods. With 3D food printers, manufacturers reduce waste to improve sustainability.

Blockchain
Consumers are keen on knowing where their food comes from, a trend that precedes the covid-19 pandemic. People want to know the origin of ingredients used to make their meals to decide whether these sources are safe, healthy, or environmentally responsible. Through blockchain technology, foodtech companies can give precise control, visibility, transparency, and efficient collaboration with their consumer’s desires.

You can trace the initial farm or seeds used to grow ahead of lettuce, the farming method, and the location of that farm using blockchain technology. That also enables processors, manufacturers, supply chain operators, and consumers to track potential contamination leaks. Other operations made possible through intelligent contracts include high-tech packaging, automated delivery through drones, and intelligent food waste recycling.

Bottom Line
Foodtech innovation disrupts how food is grown, crops processed, and products packaged, stored, and delivered throughout the supply chain. Innovators have developed technology that improves how ingredients or meals reach the consumer’s doorstep while improving safety and service quality with reduced costs.

Such technological advancements will change how food is produced, solving waste problems with the potential for eliminating hunger. Moving forward into 2022, you can expect improvements in your overall food experience due to operators leveraging these innovations.

Food Investment Panel

MarketCurrents Events will host a not to be missed Panel with family offices and experts on the food industry as they discuss the trends shaping the industry on April 21 from 11 am to 12 pm EST.

The investors and moderator on the panel are:

• Jennifer Cheng-Lo- New Chic Capital-Single family office, Hong Kong
• Gil Horsky, Mondelez, Israel
• Sasha Bernier, Cheltenham Investments Single family office, New York, US (Moderator)

The panel is about an hour long and seeks to spark discussion on three broad points:

• What are Consumers’ changing expectations for food – and the industry’s success, or lack of it, in meeting those expectations;
• What are some emerging technologies in the food industry?
• What are the hottest investment themes? Has Covid & the war in Ukraine raised new investment these?
• What investors should consider before investing in the food industry?
• Direct vs Indirect investments. Pros & Cons?
• Regulatory Considerations
• Asia and Israel are a hot bed for food start-ups – how does it compare with the US

Join us on this educational Future FoodTech trip to network with industry leaders, share expertise and experiences, and gain the most up-to-date information. For registration, click the link below:

Register your Interest