Q&A: Seeking Solutions to a $1.2 Trillion Problem: Food Loss and Waste

Q&A with Geeta Sethi, advisor and global lead for food systems and Simmy Jain, senior climate and finance specialist

Nearly 700 million people worldwide are undernourished, but it’s not because the world doesn’t produce enough food for everyone. In fact, there is enough food grown to feed an additional 2 billion people per year. The problem is that the food is either lost or wasted.

Some food never makes it to market or to consumers due to lack of transportation and especially refrigeration. This is especially true in lower-income countries. In higher-income countries the problem is more one of waste, which comes in many forms–from people not eating what they have purchased or put on their plates, to stores getting rid of products that are near their expiry date or refusing to stock “ugly” or imperfect produce.

There are many organizations working to change this situation, including the World Bank, with a short-term goal of reducing waste by one third.

The Bank’s Geeta Sethi, advisor and global lead for food systems and Simmy Jain, senior climate and finance specialist, recently sat down to answer some questions on the issue.

Q. How has the issue of food loss and waste (FLW) changed with the advent of COVID-19?

A. The COVID-19 pandemic has had severe economic and health impacts on people around the world and exposed the vulnerabilities of food supply chains. In many countries, consumers have experienced local shortages and price hikes, while farmers have been stuck with food that they can’t sell. Underlying these symptoms of a broken food system were restrictions on movement and business closures, which led to an upsurge in food loss and waste. Crucially, estimates suggest that the pandemic may add between 83 and 132 million people to the total number of undernourished in the world in 2020. These challenges have brought food loss and waste to the fore for policymakers and consumers alike.

Q. How is FLW a key environmental issue?

A. Notwithstanding the extraordinary success during the past century in making food more accessible, affordable and safe, food systems have contributed to unsustainable land use practices, depletion of fresh water, pollution from chemicals, disruption of nitrogen and phosphorus cycles, biodiversity loss, and climate change. Reducing food loss and waste is key to making food systems significantly more sustainable, maximizing output from land and natural resources already under production.

Q. What do people need to understand about solutions to food loss and waste?

A. People may know that between 30 percent and 40 percent of food produced goes uneaten. But a one-sized fits all approach to reduce losses and waste will not work at scale. In fact, interventions to address losses and waste are highly specific to government policy priorities, commodities analyzed, and the structure of the economy.

Q. What concrete steps can the world take to get a grip on the problem?

A. New World Bank research shows that policymakers can use food loss and waste reduction as an opportunity to achieve critical policy goals related to food security, farmer income, trade, greenhouse gasses, and natural resource use. Beyond identifying a menu of potential interventions that are technically and politically feasible, financial and economic analyses of the interventions must also be conducted. Developing sources of financing and financial instruments to support private and public FLW reduction action, including support for research and knowledge-based organizations, will also be key to seeing action on the ground.

Q. What is the World Bank doing to fight food loss and waste, and who are the Bank’s partners?

A. The Bank’s program on food loss and waste reduction has three prongs:

Our new flagship report, Addressing Food Loss and Waste: A Global Problem with Local Solutions, and the underpinning economic model provide the economic drivers, incentives and disincentives that explain the issue and enable us to take steps to reduce losses and waste.

The second prong of our program is applying this global model to specific countries and commodities so that governments and financiers can take action. We call these Food Smart Country Diagnostics. For select commodities in a given country, the diagnostics identify the hotspots of where losses occur along the value chain, use the model to understand the impact of addressing losses against other competing policy objectives (like food security, trade, poverty, etc.), and provide appropriate policy and financing interventions. We have completed four thus far, for Guatemala, Nigeria, Rwanda, and Vietnam and will be developing several more.

The final prong of our program is related to investments and financing. We know that public financing alone cannot solve the challenge of food loss and waste. The World Bank issued the first Sustainable Development Bond highlighting food loss and waste in March of 2019, and since then has raised over $2 billion through many transactions from a diverse set of investors. We are in the process of developing other innovative financing instruments to drive much needed capital toward solutions on the ground.

We can’t do all of this work alone! We have been working with many partners who are key to success at a global scale, including WRAP, Cornell University, Rockefeller Foundation, FAO, IFPRI, World Wildlife Fund, Rabobank, WRI, and the Dutch government.