CAPI Presentation

Nuffield Forum Ontario’s Outstanding Young Farmers’ Program

March 11, 2013

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Is there a “status quo”?

How best cope with change?

What are the key drivers of

strategy?

1. Trade developments

Canada’s deteriorating trade balance in processed food

Becoming a net importer of beef

Canada’s beef trade balance with the US ($value):

$1.4 billion (2002) vs. $42 million (2011)

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Exporting lower value / Importing higher value

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In 2011, Cdn beef exports to US averaged $3.74/kg.

US beef exports to Canada averaged $6.55/kg.

60% ↑

Value of Canada’s beef exports – by country

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2010

2. Population health

2. Costs of healthcare

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Diet

2 billion overweight & 1 billion obese

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Environmental pressures

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3 inches

…impacted 450,000 acres of prime California agriculture land

Population growth

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….

Societal & Financial Risk – Moody’s Report

3. How we think about “food”

Rising consumer expectations & concerns

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… Transparency is paramount

Challenging what is produced

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McDonald’s Global Sustainability Scorecard

Goals:

Sustainable sourcing from: beef, poultry, coffee, palm

oil, fish and fiber

Source 100% Canadian beef & pork

Phase out gestation stalls

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Goal:

Source 100% of its

agricultural raw materials sustainably.

Unilever Sustainable Living Plan 2010

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Walmart

Goals:

In Canada: purchase 30% of produce locally (when

available)

In the US: double the amount of locally grown

produce by 2015

Sell certified sustainable fish by end of 2013

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Loblaw Corporate Social Responsibility Summary

Goals:

Develop a Canadian sourcing policy

100% seafood sourced from sustainable sources

(2013)

Source all PC eggs from cage-free operations

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Innovation Centre for U.S. Dairy Sustainability Commitment Progress Report

Goal:

Reduce emissions per gallon of milk by

25% by 2020

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Is there a “status quo”?

How best cope with change?

What are the key drivers of

strategy?

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Systems thinking

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From “vision” to “destination” …

2011

Shifting the perspective

Input suppliers

Producers Processors Distributors Wholesalers Retailers

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Food system

Ecological systems: water, soil, carbon

Academics, scientists, researchers

Entrepreneurs; financial services

Adjacent sectors: e.g. health,

environment

Governments (3 levels)

Transportation; ports

Packaging, equipment,

info technology

Input suppliers

Producers

Processors

Distributors

Wholesalers

Retailers (grocery)

Restaurants; food services

By-products; bio-applications

Consumers

Food system

Ecological systems: water, soil, carbon

Academics, scientists, researchers

Entrepreneurs; financial services

Adjacent sectors: e.g. health,

environment

Governments (3 levels)

Transportation; ports

Packaging, equipment,

info technology

Input suppliers

Producers

Processors

Distributors

Wholesalers

Retailers (grocery)

Restaurants; food services

By-products; bio-applications

Reliable supply

Responsibly-produced food

Healthy population

“Metrics”

Consumers

New way of thinking…

2012

1. Lack of alignment; silos

2. No shared long-term strategy

3. Too many voices; need for leadership

Increase profitability

1. Retailer: needing to differentiate

2. Processor: needing to maximize carcass value (diverse markets)

3. Feeder & rancher: needing value from attributes in demand

→ The role of “information”

Collaboration

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Blade Farming, UK

Canadian Angus Program

Ontario Corn Fed Beef Program

Meat & Livestock Australia

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Is there a “status quo”?

How best cope with change?

What are the key drivers of

strategy?

Implications for Strategy

Isolating what drives effective strategy

❶ Shared acknowledgement of ‘the burning platform’

❷ Industry must lead – champions can galvanize action

❸ Collaboration across the supply chain, and among food system players

❹ Common objectives (consumer focus); basis for alignment

❺ Information-sharing: basis to act

Thank you