“Inflation: How It's Affecting Food Waste”
Wednesday, August 24, 2022
Inflation is having a big impact on the food system, with food prices rising 12% since last year. We know that price can have a significant impact on behavior among both businesses and consumers, so if the economic and social incentives to reduce food waste have seemingly gone up, then it stands to reason that businesses and consumers would be taking action to waste less food. But is that really happening? ReFED hosted a webinar to get at that question. Moderated by ReFED’s Jackie Suggitt, with expert panelists Dr. Brenna Ellison from Purdue University, Konstantin Zvereff from Blue Cart, and Erika Thiem from Feeding America, the discussion covered what we do and don’t know about how inflation is really affecting food waste across the food system.
At the consumer level, Ellison shared that “higher food prices just naturally incentive consumers to do better with their food resource management” – which could lead to less household food waste. According to Ellison, in a recent survey of 1,000 consumers, people were asked to rate how much inflation has affected their food purchasing, and the average score was a seven out of ten. As part of the behavior change associated with higher prices, people reported buying less red meat and seafood, along with less sweets and snacks; they also reported switching to cheaper generic brands. Citing the consumer price index, Ellison noted that prices for food consumed at home have been increasing at a higher rate than prices for food consumed outside the home (11% and 6% respectively) – a trend that has historically been the opposite. People across all socioeconomic levels are feeling the pinch of higher prices, but these increases especially impact those with tight household budgets.
“In food banking, what we see in light of the inflationary environment is a need for the level of food assistance that is as great as it was at the height of the pandemic,” Thiem said. She noted there is a gap of about three billion pounds of food that is needed for food assistance programs. It is a difficult time for food banking, as many COVID pandemic relief programs have expired, and the supply chain is experiencing issues as well, making surplus food less available. On top of that, like everyone else, Feeding America and its partners are now purchasing food at higher prices, so their budget is not going as far – for example, a jar of peanut butter is costing Feeding America a dollar more than a year ago.
Zvereff emphasized that for restaurants, there are many things that are impacting spending patterns. Things such as the war in Ukraine and the resulting grain shortage, drastic labor shortages across the supply chain, consumer expectations, and inflation are all creating an extremely challenging time for restaurants. “As if this problem wasn’t complex enough, it has so many different ingredients,” he said. Highlighting the impact on food waste, Zevreff noted that the general problem is that most restaurants have a fixed menu, using the same ingredients in the same quantities regardless of price, seasonality, origin, or other factors. Restaurants that have a rotating menu using different ingredients all the time can have the advantage of setting different expectations from consumers, and therefore are able to order ingredients that are more available in appropriate quantities based on expected consumer demand.
It is clear that there are a lot of complications in the food system as the result of inflation, and that creative solutions like rotating menus will be necessary moving forward. In each of these sectors, the panelists called for more innovation. One example from food banking is the increased use of salvage grocery stores as a secondary market for retailers prior to donation. There have also been advances in the safe handling of soon to perish and fresh foods, and on the farm level to support growers via gleaning and fair compensation. “There is going to be significant innovation to address these new challenges,” Zevreff said, highlighting the food system’s adaptability.