Asia’s food spending set to double to more than $8 trillion by 2030
Asian consumers are set to double their spending on food by 2030, leaving a gaping hole for investors to bring healthier and more sustainable options to the table, according to a new joint report by PwC, Rabobank and Temasek.
Food spending in the region will hit more than $8 trillion by the start of the next decade — up from $4 trillion in 2019 — becoming the world’s largest food and beverage market, the group’s “Asia Food Challenge Report 2021” said Tuesday.
Changes in consumer behavior, as well as the rapid growth of its population, will contribute to much of this demand. Asia will be home to approximately 4.5 billion people by 2030 and to account for 65% of global middle class.
The people want safe food, healthier food, and they prefer to order online.
managing director, agribusiness, Temasek
“Folks want healthier food, they want safer food, they want to buy online, they want food that is sustainable,” Anuj Maheshwari, Temasek’s managing director of agribusiness, told CNBC’s “Squawk Box Asia.”
India and Southeast Asia are set to account for the greatest increase in spending, growing at a compound annual rate of 5.3% and 4.7%, respectively. China is still the world’s largest market.
These findings are the result of a survey that included 3,600 respondents from 12 Asia-Pacific nations, conversations with top executives and an analysis of more than 3,000 publicly traded food companies and beverages.
A $1.5 trillion investment opportunity
The rapid uptick puts pressure on an already fragile food ecosystem, which has been under immense pressure since the outbreak of the coronavirus pandemic.
It will require $1.55 trillion in investment across the value chain by 2030 to satisfy the region’s growing food demand, according to the report. The $750 billion increase is compared to the $800 million upstream investment (or preliminary), originally calculated in the 2019 group’s first report.
The customers purchase vegetables in a supermarket located in Handan Province (China), September 9, 2021.
Visual China Group | Visual China Group | Getty Images
That presents significant commercial opportunities for investors, said Maheshwari, calling it a “big, big area in Asia.”
The report contained six key trends, including fresh produce, traceable and healthy sources, sustainable consumption and alternative protein, as well as online buying.
Maheshwari stated that these trends are what Agribusinesses should focus on to ensure consumers have access to this type of food, in addition to the volumes we require in Asia.
According to AgFunder, investments in agriculture technology have increased substantially from 2014 to $30.5 billion by rising 377%, or 30.5 billion.