The future of food hangs on Asian innovation

FOOD technology is no longer a niche industry. The size of the global plant-based market is poised to more than triple from US$10 billion in 2018 to US$31 billion in 2026, with Asia set to outstrip the US and Europe in growth. Nevertheless, when it comes to impact, we still have some way to go. Food-tech impact can be best understood as technological innovations that shift the nature of individual and household dietary consumption in a way that is better for the planet, and ideally better for the health of individuals.

Close to home, Singapore's landscape paints a clear picture of how this has evolved. Hawker centres now boast more sophisticated nutrition-conscious menus and food delivery services now respond to real-time changes in demand as consumer eating habits skew towards less traditional dining choices.

But beyond the short-term benefits of consumer and retail convenience, food-tech plays a much larger role in our society's development. This sector will be key if we are to find answers to future existential challenges, which include the carbon and water footprint of livestock agriculture, antibiotic resistance in poultry and global fishery depletion.

Investors are sitting up and noticing the business potential too, with a dramatic increase in attention being placed on food-tech startups, buoyed by high-profile listings of companies like Beyond Meat. This has led to a deluge of new funding entering the market in recent years, with corporate venture capital players like Unilever Ventures setting up shop alongside dedicated funds like New Crop Capital. In Asia, Big Idea Ventures is looking to complete a US$50 million fundraising; it launched its sustainable food accelerator programme in Singapore last November.

As we step into the next decade, it is important to define impact in this space and explore the three overlapping factors that will shape the future of food in Asia.

Understanding the factors shaping the Asian palate

Any food-tech company that cares about sustainability needs to have a strategy that is focused aggressively on engaging with the palates of Asian consumers. This is challenging as Asian consumers are not, in any way, monolithic. There is a wide range of incomes, cultural preferences, dietary restrictions and sociological norms for consumption.

The sheer size of the population in Asia and the natural trajectory of economic growth in this region, which covers roughly 3.5 billion people, will more than counterbalance gains made in Europe or North America.

To focus on reducing meat consumption in the "developed West" while ignoring half the global population that's rapidly increasing their dietary intake of highly unsustainable foodstuffs is highly illogical from a damage-mitigation perspective.

It would be a missed opportunity if companies do not leverage the high digital potential of Asian consumers and their openness to innovation. Take, for instance, dark kitchens, which are data-driven delivery-only kitchens, and menu optimisation experimentation to "leapfrog" the developments in the West and rapidly iterate what consumers see.

By partnering with full-stack food delivery and cloud kitchen operators, industry proponents can get rich data insights around consumer preferences that will enable them to iterate their products in a way that is historically considered viable.

Take for example, Deliveroo Singapore's recent collaboration with Impossible Foods. As part of its local launch, the Deliveroo platform optimised its app user interface to boost discoverability via initiatives like in-app banners and custom tagging. In the first two weeks of Impossible's launch on Deliveroo, sales volumes broke records.

Additionally, the data generated in the subsequent months has yielded insights around pricing and consumer preferences on tens of thousands of distinct orders. This data is used to engage with restaurant partners to optimise product offerings to customers this year. In addition to this, the Impossible Foods team worked closely with restaurant partners to create Impossible versions of local favourites (such as Impossible dan dan noodles). The pinnacle of this localisation strategy was seen with the recent announcement of Impossible Pork - a product ideally suited for the broader Chinese market.

Tying into these trends, Deliveroo Singapore has recorded a 104 per cent increase in the number of plant-based restaurants on its platform since 2018.

Assuring food quality amid pathologic concerns

The benefits of food-tech innovation will be pointless if it does not respond to the pathologic concerns of today's environment.

As we have seen with the ongoing African swine flu epidemic in China, the food supply chain in this part of the world is deeply vulnerable to pathologic concerns that, if not addressed, could lead to potential pandemics.

This is of critical concern, given the combination of (i) dense populations (ii) underdeveloped health services in much of the region and (iii) increased global people flows coming through the region.

The Sars epidemic in Hong Kong could have been a precursor of a much deadlier infection in the 2020s and the need for high-quality food-tech in this region is only exacerbated by this fact.

Westernisation and a rise in meat consumption

Companies that aspire to meaningfully improve the state of the planet have a rare and timely window of opportunity to insert themselves into the food supply of these countries, while food consumption patterns remain in a liminal space between historic cultural norms and more Western-style diets.

Asian countries have spent the last several years seeing unprecedented economic growth. Beyond the obvious examples of India and China, Vietnam's GDP between 2010-2019 more than doubled from US$115 billion to US$260 billion and is now larger than that of Portugal. As consumer spending patterns catch up to that growth, we are seeing a substantial increase in meat consumption. Individuals and households that previously would have meat two to three times a week now wish to consume it two to three times a day.

The increase in household income is shattering age-old norms around plant-heavy diets, which has historically been prominent due to the combination of the region's religious influences and low incomes.

This is a socioeconomic trend that is, unfortunately, to use the modalities of Jeff Bezos, very much a "one-way door". It is extremely challenging to convince individuals who have gone from a position of relative impoverishment to one where they can afford to eat as much meat as they like, any time, to voluntarily revert to a lifestyle where meat is a limited part of their diet. This is especially true, given the cultural cachet that comes from being seen to visibly afford large qualities of animal protein in emerging markets.

Singapore presents food tech's greatest opportunity to leapfrog innovation

Innovations coming out of the Anglo-centric food-tech players would develop more meaningful solutions with an Asian hub in Singapore.

This small island of six million people has, through geographic chance and the government's strategic development, turned into what is arguably the world's most exciting culinary test market. In Singapore, food products must be of a very high standard to survive. Those that succeed will have a powerful springboard to take on the rest of Asia and be an example to the rest of the world.