It's hard to imagine a gathering anywhere with a more impressive wealth of food-industry knowledge than one convened recently at a Star Tribune roundtable. On the panel were four influential Minnesota chief executives whose responsibilities include not just running a company, but feeding the world: Greg Page of Cargill, Ken Powell of General Mills, Russell (Tres) Lund III of Lund Food Holdings and John Johnson of CHS, Inc., a Fortune 200 energy, grains and foods cooperative.
The topic: rising food prices. The question at hand: Is the era of cheap food over? Not surprisingly, the answer was complex, reflecting the executives' sophisticated grasp of how rising global demand, sky-high oil prices, ethanol production, the weak dollar and the high cost of credit (the lifeblood of agriculture) are colliding in the most mundane of places: on grocery shoppers' scrolling white receipts.
The big takeaway message was both heartening and sobering. Yes, we can feed the world. As Cargill's Page put it, with the globe's current calorie production, we are the farthest we've ever been from famine. But the luxurious food era that Americans have grown accustomed to -- a time of too-large portions and little heed for waste -- has come to an end. Food will continue to be plentiful, its cost manageable. But we can no longer take it for granted. It has returned to what it always has been throughout human history: a resource to conserve and use wisely.
These CEOs are leading the charge into this new era. At a macro level, they are using their clout to champion technology -- for example, with genetically modified seeds -- to increase crop yields. And they are advocating to let free markets work without government interference to keep prices down.
They are also pushing their companies to boost efficiency and productivity to keep prices in check. That pioneering work can also be seen in the familiar setting of the grocery store. General Mills significantly cut shipping and packaging costs by finding a new way to put noodles in Hamburger Helper boxes. Lund, of Lund Foods, has watched his own family's habits at home, where aging food is sometimes thrown out at the end of the week. He has called for new ways to sell old products -- half an apple pie instead of a whole one -- to cut back on consumers' food waste. The chain is also looking at ways to reduce energy use, one of the grocery stores' biggest costs.
At a time when high gas prices are forcing the nation to rethink energy consumption, there should be a similar conversation happening around food. These executives' proactive strategies offer ample food for thought for consumers. The call to let free markets work their magic is part of a debate in which Minnesotans have a big stake. Although ethanol production isn't the main factor driving up food prices, it has played a role. Do state and federal production mandates or subsidies push corn prices higher by interfering with market signals? That's worthy of further discussion.
Consumers also have a role to play in holding their grocery bills down, and could take a cue from these companies' push to reduce waste and energy use. Right-sized food portions are an excellent start, and a smart way to improve your family's health. There are ways to better use the food you buy, and throw out less.
CHS's John Johnson is right when he takes the long view on energy and food costs. Higher prices will force changes, some of them painful, but the result will be worth it. Said Johnson: "We'll be better users of the resources of the world.''