The use of both robotics and data technology in the food industry is growing rapidly. Where robotisation and digitalisation help increase the productivity of workers, data technology helps food producers share more information from the supply chain.
ING's Economics Department reports this in the publication 'Foodtech: robotic arm offers food industry a helping hand'. Every year, food manufacturers in the Netherlands invest 350 million euros in R&D and 1.4 billion euros in machinery and digitalisation. Workers therefore have more and more machines, software and data at their disposal. For instance, the value of machines per employee rose from 69,000 euros in 1996 to 121,000 euros in 2016. The value of software and data rose from 1,400 to 4,700 euros during this period.
Necessary for competitiveness
The deployment of new technologies is not only useful, but also necessary for Dutch manufacturers to remain competitive, according to ING. For instance, food industry customers are setting ever-stricter product requirements and demanding ever-larger volumes at low prices. Every year, Dutch food manufacturers invest EUR 1.4 billion in technology to increase labour productivity and meet market demand.
ING points out that this productivity growth is not yet exhausted. For instance, about one in four manufacturers uses robotics and/or big data analytics. This percentage is expected to increase further in the near future. Artificial intelligence (AI), among other things, can help make production processes more efficient. Also, sales of robots to the food industry are increasing.
Consumers want more information
It is also noticeable that consumers want more and more information about the production of their food. Currently, for instance, consumers often have no insight into the use of technology in this production process and, in their own opinion, have too little insight into the links of the food chain. For example, 52% of respondents in today's ING Question said they would like to know more about the production of their food. For example, consumers consider it important that their food is healthier (43%), more environmentally friendly (18%) and safer (14%). Consumers also try to avoid sugar (42%), fat (17%) and salt (14%).
Such information provision can be delivered using data technology, which can facilitate information exchange in the chain. This makes it possible to trace food down to the product level. "Greater transparency about the origin and production of food helps bridge the distance between producer and consumer. RFID chips, for example, make it possible to track meat products from source to plate. However, this often requires far-reaching cooperation within the production chain," explains Ceel Elemans Sector Banker Food & Agri at ING.
Employment
The study also looked at employment. The food industry faces a double challenge in this area. For instance, more than a quarter of the industry's 150,000 employees will retire between now and 2030, amounting to some 40,000 employees. In addition, to continue its growth, the sector is estimated to need an additional 7,000 people.
At the same time, production processes are becoming increasingly complex, requiring staff training and the influx of employees with new knowledge and skills. Technology can also be used to automate heavy work, further increase labour productivity and reduce the risk of future staff shortages.
'Food industry needs to invest more'
ING calls it important here that the food industry invests more. If investment in technology increases from EUR 1.4 billion now to EUR 2 billion in 2030, the ING Economics Bureau expects that almost half of future workforce needs can be met through technological innovation. Elemans: "The industry will only remain internationally competitive if it succeeds in both increasing investment in production technology and increasing the influx of technical and analytical staff".
Investment is best focused on three foodtech applications, according to ING:
- Robotisation: the use of robots makes the production process more constant by increasing production volume and enhancing food safety. At the same time, the process becomes less labour-intensive, which can reduce personnel costs.
- Digitisation: the use of data technology increases the predictability of the production process, while AI allows production lines to be deployed more efficiently. This enables the food industry to increase efficiency.
- New processing techniques: the use of new processing techniques provide quality preservation and new sustainability opportunities for production processes.
The full analysis from ING's Economics Department can be found here.
Author: Wouter Hoeffnagel
Source: ING
