Biofuel and Chinese Wheat

Welcome back Food Junglers. It’s safe to say that the last seven days have been a whirlwind with political turmoil and hurricanes all, seemingly, taking place at the same time. There’s definitely no shortage of discussion. Let’s dig in.

This week:

♻️ Nestlé keeps pushing with green initiatives in Chile and abroad.

⛽️ Joe Biden’s biofuel policy is getting some backlash in the US.

📉 PepsiCo’s customers are tired of elevated prices.

🌾 China looks to produce more of its own food.

🧈 It looks like you can make butter with CO2 nowadays…

CLIMATE
NESTLÉ IS ON A MISSION

Nestlé’s climate friendly initiatives have been very active this week with the company introducing a new variety of Arabica coffee and a plant-based, soy protein product in Chile.

The food conglomerate’s new, high-yielding coffee beans are larger, can resist rust and several diseases, and need less land for growth.

In Chile, Nestlé will be introducing Maggi Rindecarne, a packet of seasoned soy protein that is designed to be mixed with normal beef so that price-sensitive consumers don’t eat as much animal protein.

ZOOMING OUT: These are only just some of the climate-conscious initiatives that the largest food company in the world has up its sleeve. And, with Nestlé wanting to reach net zero by 2050, I feel like such projects will be coming thick and fast.

POLICY
BIDEN’S BIOFUEL DEBATE

On top of an already weakened presidential campaign, Joe Biden will have to defend American farmers who are unhappy with the cheap biofuel ingredients, imported from China and Brazil.

US biofuel manufacturers currently benefit from government tax breaks, regardless of whether the raw ingredients for biofuel - used cooking oil, beef fat, soybeans and corn - are imported from elsewhere.

As a result, American biofuel manufacturers are choosing to buy as cheap as possible from China and Brazil, angering many corn, wheat, and soy farmers in the US.

ZOOMING OUT: US farm incomes are poised for their biggest decline since 2006. So, allowing big biofuel manufacturers to import cheaply, foregoing American raw materials, could push many farmers into Republican territory for the upcoming election.

BUSINESS
PEPSICO LOSES CUSTOMERS

PepsiCo delivered its quarterly earnings last week and the results were particularly concerning for the snack and breakfast segment, which showed that customers are tired of continuous price rises and are subsequently buying fewer products.

Quaker Foods North America - PepsiCo’s breakfast and snack segment - reported an 18% drop in revenue and a 34% decline in operating profit last quarter.

Together with various salmonella complications, PepsiCo has increased their snack prices for three consecutive years now, and shareholders have noticed that customers aren’t happy.

ZOOMING OUT: To address this consumer frustration, the company’s CEO - Ramon Laguarta - has resolved to cut prices and offer more sales on certain salty snacks. Whether they can balance this and their ambitious sustainability goals, though, remains to be seen.

SUPPLY CHAIN
CHINA LOOKS INWARDS

As political tensions continue to mount and import prices escalate, China is intently focused on becoming self-sufficient, investing billions into new agricultural initiatives.

The country recently introduced its first food security law, which aimed to further boost domestic food production and hold officials accountable for its implementation.

Success is already visible. China’s overall arable land increased after a prolonged productivity drought and one village - Nanliuhue - is already growing wheat after having most of its land be underwater for years.

ZOOMING OUT: The country aims to raise self-sufficiency in grains and reduce imports by more than 30%. And, as the country feeds a fifth of the global population with less than a tenth of the world’s arable land, I can understand the urgency.

THE BRIGHT SIDE
BUTTER FROM THIN AIR

I’m not going to go into detail about either the perils of the global dairy industry or the biodiversity losses associated with canola and palm crops, since that has been well-established here on Food Jungle.

More excitingly, though, I’ve come across a small, California-based company - Savor - that is making a name for itself for producing real butter from carbon dioxide.

Backed by Bill Gates himself, the team at Savor uses thermochemical methods that involve pulling carbon dioxide from the air and hydrogen from water, then heating and oxidising them, to create fats like the ones you see in butter.

The company has raised over $33 million and is looking to develop milk, ice cream, cheese and meats without the use of animals or mono-cropping agriculture. Food Jungle approved ✅

BEFORE YOU GO…

• Shares in Delivery Hero have fallen as the European Commission looks to fine the German company more than €400 million due to antitrust violations.

• Sainsbury's has become the “first retailer in the world” to invest in new AI veterinary technology used to measure animal welfare on dairy farms.

• A farm in California is now associated with the largest raw-milk salmonella outbreak in past decade.

• Costco has raised its annual membership fees for the first time since 2017, boosting them from $5 to $10.

• The Chinese parent company of Smithfield Foods - the world’s largest pork-producer by sales - says it plans to go public in the U.S.

TAKE A BREAK

If you’re interested in some quality ORIGINAL journalism on what’s been going on in the food industry, look no further than Green Queen.

Founded in 2011, by Sonalie Figueiras, the team looks to analyse and discuss the latest news in food, from cultivated meat to food waste. Thoroughly recommend! 🤩