Food used to be just something you ate, but it’s increasingly a statement of a consumer’s values — and that’s a challenge for the food and agricultural industries.
That was the upshot of a speech Tuesday by Cargill CEO David MacLennan at the University of Minnesota’s McNamara Alumni Center. MacLennan’s talk on “the future of food” was part of the First Tuesday series sponsored by the U’s Carlson School of Management.
Also Tuesday, Cargill announced it has sold its dressing, sauces and mayonnaise business to California-based Ventura Foods for an undisclosed price. Ventura is a 50-50 joint venture between Inver Grove Heights-based CHS Inc. and Mitsui & Co., part of a Japan-based conglomerate.
Cargill, one of the world’s largest privately held companies, has a portfolio that includes — just for starters — grain exporting, meat processing, chocolate making and palm oil production. The company is sort of a giant conduit from farmers to big food makers and retailers. As such, it usually has a stake in the many debates over food production.
“When you think about the future of food, we are really seeing significant disruption and significant changes,” MacLennan told a full house. “Consumers are increasingly making decisions on what they eat and how they eat based on their values.”
They want to know more about what’s in their food, how it’s made — and how animals are treated in the production process, MacLennan said.
Genetically modified organisms have been a big issue in recent years, as over 90 percent of U.S. soybeans, corn and sugar beets are grown from GMO seed. Federal regulators long ago approved GMOs as safe, but consumer mistrust persists about bioengineering and the safety of GMO ingredients. “We are seeing science intersect with values,” MacLennan said.
Cargill has been a staunch supporter of genetically engineered crops. But at the same time, it’s been developing GMO-free supply chains, in both corn and soybeans, for food manufacturers tapping a growing GMO-free market.
MacLennan said abandoning GMO crops would lead to lower crop yields. And to offset lower yields, more pastureland and forests would have to be converted to farmland to grow the same amount of food — a “trade off,” he said.
Cargill has been restructuring its business portfolio to an extent over the past year or so, including two roughly $1.5 billion deals to bolster its global fish feed operations and to exit the U.S. pork trade.