Ugly fruits and vegetables rarely get eaten – only the pretty ones make it to the market. The Environmental Protection Agency states 20 billion pounds of produce go to waste EACH YEAR due to surplus or just being plain unattractive. In fact, more food reaches U.S. landfills and incinerators than any other waste.
Turns out, there’s a big market for ugly produce that is making itself known. It’s a good thing because the demand for food to feed the world will increase by 50% or three billion by 2050. We’ll be looking at 10.5 billion more mouths to feed!
“Just like the wave of technology that impacted our information industries, another big wave of technology is reshaping . . . our agriculture industry” according to Stanford Graduate School Business professor Haim Mendelson”. That wave translates into venture capital firms investing in new agriculture technology.
One of those companies getting funding is Full Harvest, which recently announced it has closed an $8.5 million Series A round of financing led by venture capitalists from Spark Capital.
Full Harvest is a company that helps growers get the most out of their harvest by bringing farm excess to market. They’re a Business to Business (B2B) platform connecting large farms to food businesses to sell significantly discounted, yet perfectly good surplus and imperfectly shaped produce that would have otherwise gone to waste.
But, there’s a lot of obstacles to sort out for companies who purchase excess and ugly produce to reach its buyers. According to Elliot Rabinovich, a professor at Arizona State University who, along with his colleague, Tim Richards, studies how to develop these businesses. Rabinovich states there are four operational challenges:
- The first is to systematise distinctions in quality that can allow useful pricing.
- The second is efficient distribution, since the deteriorating products must reach customers quickly and, as cost is an important aspect of their appeal, cheaply.
- Third, liability must be sorted out. Products may arrive too old to be usable and even in some cases spoiled and dangerous. That can have the odd consequence of inadvertently making the intermediary a food-seller, falling under the regulatory umbrella of the USDA.
- Finally, there is profitability. Small growers have often found substandard produce too costly to handle. Some worry that even if they earn a bit on these kinds of produce, that may eat into the sales of their pretty stuff. Mr Rabinovich says such concerns are likely to be tackled as the market gains scale, enabling more variety (pleasing users) and more demand (pleasing providers). Slowly, ideas on better ways to run one of the world’s oldest markets, the trade in food, are bearing fruit.
Fortunately, we’ll be hearing a lot more about new agricultural technology in the next few years that will make the industry more efficient and effective in feeding those 10.5 billion mouths by 2050.