From hidden vulnerabilities to future-ready solutions – our second Kerry Health and Nutrition Institute podcast puts the resilience of today’s food system under the spotlight and asks what it will take to strengthen it.
Hosted by the KHNI and moderated by Mary Shelman, founder of the Shelman Group, this session brought together Wolfram Schlenker, the Ray A. Goldberg Professor of the Global Food System at Harvard University, and Juan Aguiriano, Group Head of Marketing and Sustainability at Kerry.
The discussion examined how climate shocks, environmental pressures, and geopolitical volatility are exposing real fragility – driving all-round disruption leading to unpredictability, supply instability, and price variability.
The panel explored the growing complexity shaping food and agriculture and why resilience must sit at the centre of every decision. Embedding sustainable resilience into risk management was identified as strengthening a company’s ability to forecast and anticipate disruption and ultimately generate long‑term value.
Speakers highlighted the complexities around trade-offs between sustainability, affordability, resilience, and nutrition – while at the same time meeting consumer expectations. They pointed to the expanding role of data and AI in enabling more resilient production systems, smarter and more adaptive supply chains, and better-informed consumer decision-making.
The message is clear: sustainable resilience is no longer a cost – it’s core to risk management and long-term growth. Food’s future lies not in producing more, but in producing better — driven by partnership, innovation, and a mindset built for resilience.
Reformulation has become a vital strategy for companies striving to remain competitive while tackling diverse challenges. It draws on science and innovation to reimagine product processing and composition, delivering healthier, more sustainable, and cost-efficient options that don’t compromise on taste or convenience.
With consumers expecting more from what they eat and keeping a closer eye on affordability, reformulation has become a non-negotiable strategy for food and beverage companies seeking to succeed in today’s complex and fast-moving market.
By prioritising cost efficiency, health-focused innovation, and waste reduction, businesses can better manage sourcing, supply chain, and trade challenges while delivering profitable, high-quality products that align with the expectations of health-conscious consumers. As reformulation increasingly shifts from a competitive advantage to an industry requirement, manufacturers have a timely opportunity to act now and position themselves ahead of the curve.
To read more click on: The Future of Food: Reformulating for Sustainable Nutrition – Food Industry Executive
In recent years, the global food and beverage industry has faced significant disruptions, particularly in the supply of cocoa, citrus, and coffee. Each of these raw materials are frequently used in many products consumed in every region of the world. These challenges have led to a surge in prices, scarcity, and supply chain disruptions not only impacting both the food and beverage industry, but also retailers and consumers. What are the challenges causing these issues and what is being done to address these serious issues?
Cocoa Supply Challenges
The cocoa industry, primarily concentrated in West Africa, has been hit hard by a combination of environmental, economic, and human factors. Côte d’Ivoire and Ghana, which produce around 60% of the world’s cocoa1, have seen a sharp decline in production. With this significant share of the global production, any disruptions will have a substantial impact to the market. This sharp decline can be linked to several factors:
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- Climate change: Climate change is a major driver of the cocoa shortage. Shifting and adverse weather patterns has led to unpredictable temperature extremes and variable rainfall has impacted cocoa trees, which are particularly vulnerable to these challenges2.
- El Niño Impact: The El Niño phenomenon, characterized by warming sea surfaces temperature in the Pacific Ocean, further exacerbates the issues caused by climate change. El Niño causes both drought-like conditions or increased heavy rainfall. Drought often leading to the cocoa trees becoming stressed and warm weather with rainfall allow for disease, both significantly reducing yields.
- Plant Diseases: Cocoa trees are susceptible various diseases and pests, which great negatively impact yields. For example, Black Pod disease is a fungal infection thrives in humid climates, severely affecting cocoa trees in Ghana3. Swollen Root virus also contributes to loss of yield as infected cocoa trees are cut down to reduce spread4.
- Aging trees: Many cocoa tree farms (particular in West Africa), have aging trees that become less productive and more susceptible to disease as they age. This, underinvestment in farms, hinder farmers from replanting newer, more resilient crops5.
- Labour shortages: In addition to environmental and economic challenges, labour shortages have plagued the industry. Cocoa farmers often have challenges finding and retaining skilled workers6.
- Deforestation: Deforestation, driven by the expansion of cocoa plantations has also greatly impacted cocoa production. Clearing forests disrupts key ecosystems, reduces biodiversity, and negatively impacts soil quality. This has led to lower yields and increased vulnerability to disease and pests.
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These supply challenges meant that 2024 cocoa prices were not only quite volatile but also resulted in a significant price increase for cocoa derived raw materials. This ripple effect is still felt across the food industry, particularly among chocolate manufacturers who rely heavily on West African cocoa. Many manufacturers are now looking to stockpile their cocoa resources in an attempt to reduce future uncertainties in their supply chains.
Such market dynamics have resulted in fast-tracked innovations in the chocolate industry, with ingredient alternatives for cocoa getting more media coverage than ever before. Although benefits for such alternatives needs to go far beyond just cost. Innovations and solutions for cocoa will need to deliver on sustainable impacts as well with clear long-term sustainability that can benefit both manufacturers and consumers.
Citrus Supply Challenges
The citrus industry is also grappling with severe supply issues. Brazil and the US, which dominate the global orange juice market (with a combined 34% of the global orange production)8,10, are facing their own challenges. Brazil is experiencing its smallest crop in decades due to severe drought and citrus greening disease, while Florida’s groves are similarly afflicted. Catastrophic floods in Spain, another major citrus producer (number 6 in the world)7, have also devastated crops, leading to substantial financial losses. These disruptions have led to a significant shortage of oranges, driving up the cost of orange juice by 130% year-on-year11. Retailers and food manufacturers are being forced to innovate, with some turning to alternative fruits like mandarins to meet consumer demand.
Coffee Supply Challenges
The coffee industry is no stranger to supply challenges either. Brazil, Colombia, and Vietnam, the top coffee producers, are facing a combination of adverse weather conditions, labour shortages, and logistical hurdles. Brazil, in particular, has been hit by severe droughts and frosts, leading to a significant reduction in coffee yields12. These supply constraints have caused coffee prices to soar, affecting both retailers and consumers. Coffee shops and grocery stores are struggling to maintain stock levels, and consumers are feeling the pinch with higher prices for their daily caffeine fix.
Impact on the Food Industry and Retailers
The supply challenges in cocoa, citrus, and coffee have far-reaching implications for the food industry and retailers. Commodity inflation has become a significant concern, with the cost of ingredients rising sharply. This has led to higher prices for end products, from chocolate bars to orange juice and coffee. Retailers are caught in a difficult position, balancing the need to pass on increased costs to consumers while managing their reputation.
It’s important to recognise that all the recent scrutiny around such commodities can influence long term product ideation and development for food and beverage manufacturers. Food manufacturers are exploring innovative solutions to mitigate the impact of supply shortages, such as diversifying their product lines and sourcing alternative ingredients (for example using mandarin juice in place of orange juice)13. Additionally, these reformulations need to consider the impact on taste and cost within the final product, optimising for consumer preferences.
In conclusion, the commodity crisis affecting cocoa, citrus, and coffee underscores the vulnerability of global supply chains to environmental and economic disruptions. As the food industry and retailers navigate these challenges, consumers are likely to continue facing higher prices for their favourite products.
Numerous countries across the globe have initiated actions to reduce sugar intake, including reformulation, targeted taxation, front-of-pack labeling, and more. Initiatives to reduce sugar content of foods can be dependent on the supply chain being able to support such changes.
The World Health Organization recently undertook a novel food supply chain analysis to identify possible incentives and disincentives throughout the supply chain for sugar reduction. For sugar, the supply chain can include production of crop (sugar cane or beet), trade of raw or refined sugar, processing, adding the processed sugar to food or drink in manufacturing, and finally the sale of those foods or drinks.
The questions they attempted to find answers for are:
• What are the incentives and disincentives for industry to reduce the amount of sugar in manufactured food and drink products?
• At what point along the supply chain do these incentives and disincentives operate?
• Are there opportunities to effectively enhance the incentives and/or lessen the disincentives for reducing sugar?
The findings showed that there are areas where the supply chain supports sugar reduction, but also many barriers. There are many incentives to use sugar in foods and beverages, making it challenging to find alternatives or reduce total levels of sugar in products.
These findings were used to create some preliminary insights from WHO on steps forward for reducing sugar, both at policy and manufacturer levels. These insights include:
- Disincentives for including added sugar in foods and beverages via policy (e.g. listing ‘added sugar’ to nutrition labels)
- Avoiding unintended consequences of sugar reduction – what is it replaced with? For example, if fat is added back, is the product higher in calories than the original higher-sugar version?
- Maintaining freshness and safety due to the functional role of sugar in foods and beverages
These considerations, as well as the rest outlined in the report, are critical when formulating sugar-reduced foods and designing policy to improve nutrition of the food supply.