CFI food and beverage research and innovation priority setting final report 2017

1 September 2017

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Executive summary

With the support of Agriculture and Agri-Food Canada and in conjunction with members of the Canadian Council of Food Processors (CCFP), Canadian Food Innovators (CFI) undertook development of a prioritized plan for food processing research and innovation in Canada at the company level. This process included seven regional and one national meeting with representatives from large and small food and beverage processing businesses, the research community, government, and organizations that support innovation in the sector. An environmental scan of food processing innovation research in Canada and a nationally distributed survey were also completed.

As a result of this consultative process, the following priority research theme areas have been developed:

Food solutions that build public trust and address consumer needs: health  and wellness innovations (e.g. products with reduced levels of sugar, fat and/or  sodium); clean label foods (e.g. foods with minimal additives); and functional foods and novel ingredients (e.g. prebiotics, probiotics).

Food safety innovation: showing innovative processing technologies and product formulations are safe; packaging innovations that extend shelf-life, enhance safety and quality attributes; and advanced detection methods for pathogens, adulteration and other risk factors.

Innovative technologies that contribute to sustainable practices and climate change mitigation: automation for higher productivity from labour and/or  gains in yield and recovery; process improvements for better quality and performance, higher efficiency/ reduced cost, and/or  greater flexibility; clean technologies that offer more efficient use of water and energy resources and/ or reduced greenhouse gas emissions; and reduced packaging and/or  expanded application of biodegradable packaging or fully recyclable packaging.

Value-added  products and processes for market growth and global  competitiveness: developing innovative products using commodity ingredients (e.g. dairy,  pulses, grains, and produce) with a focus on those grown or produced in Canada; recovering greater value from waste streams and co-products; and extending the value of food ingredients through non-food applications.

Forum participants also expressed their need for support in other areas to help them advance research and innovation in their business. This need for support includes building greater awareness of the resources and expertise already in place in Canada through the development and promotion of an asset inventory, as well as facilitating collaboration and networking across the sector to build relationships that will lead to collaborative research projects and innovation initiatives. Beyond facilitating collaboration and awareness within the sector, a desire was also expressed to have CFI take on the role of lead agency representing the Canadian food and beverage processing industry in R&D and innovation related discussions with government.

The challenge in implementing the needs identified by forum participants is that of limited resources. In addition to seed capital to develop relevant products and services, there must also be a means to make them financially sustainable over the long term.

Summary of priority research themes

The following priority research theme areas have been developed as a result of CFI’s cross-country forum process, nationally distributed survey, and consultation with national food and beverage processing leaders.

Food solutions that build public trust and address consumer needs

  • Health and wellness innovations (e.g. products with reduced levels of sugar, fat and/or  sodium)
  • Clean label foods (e.g. foods with minimal additives)
  • Functional foods and novel ingredients (e.g. prebiotics, probiotics)

Food safety innovation

  • Showing innovative processing technologies and product formulations are safe
  • Packaging innovations that extend shelf-life, enhance safety and quality attributes
  • Advanced detection methods for pathogens, adulteration and other risk factors

Innovative technologies that contribute to sustainable practices and climate change mitigation

  • Automation for higher productivity from labour and/or  gains in yield and recovery
  • Process improvements for better quality and performance, higher efficiency/reduced cost, and/or  greater flexibility
  • Clean technologies that offer more efficient use of water and energy resources and/or reduced greenhouse gas emissions
  • Reduced packaging and/or  expanded application of biodegradable packaging or fully recyclable packaging

Value-added  products and processes for market growth and global competitiveness

  • Developing innovative products using commodity ingredients (e.g. dairy, pulses, grains, produce) with a focus on those grown or produced in Canada
  • Recovering greater value from waste streams and co-products
  • Extending the value of food ingredients through non-food applications

CFI’s priority research theme setting process

With the support of Agriculture and Agri-Food Canada, Canadian Food Innovators (CFI) undertook development of a prioritized plan for food processing research and innovation in Canada at the company level.

In conjunction with the members of the Canadian Council of Food Processors (CCFP), CFI undertook  consultations with industry in spring 2017  to verify the research priorities of Canada’s food processing sector. Seven meetings were held across the country to gather the input from industry representatives, including large processing businesses as well as small and medium enterprises (SMEs), academia, government, and organizations that support innovation in the sector.

Subsequently, a national meeting was held with food and beverage processing industry leaders and government representatives to review and validate the regional findings. Reports from all eight meetings are in the appendix of this document.

CFI retained Brezina Consulting to complete an environmental scan of food processing innovation research in Canada. This report, together with accompanying recommendations, is in the appendix of this document.

A survey was developed and distributed nationally in both official languages via the CCFP members in an effort to capture input from those who were unable to participate in one of the forum sessions.

Research themes

Food solutions that  build public trust and address consumer needs

Being able to respond to consumer demands for new food products, address their preferences and perceptions, and take advantage of consumer food trends was the top opportunity identified by participants in six of the seven regions.

Several factors are responsible for this priority. One is changing demographics – millennial consumers, aging Baby Boomers, and immigration increasing Canada’s  diversity. Another is increased consumer awareness of and interest in how food is produced and where it comes from.   Social conscience is an important factor in consumer choice and often formed by perceptions influenced by social and conventional media. The passion of consumers for food presents significant opportunities for new, healthier food and beverage products, more sustainable production, and uses for novel and functional food ingredients.

Health and wellness innovations

Food for health is a large opportunity, as healthy eating and government regulations mandating healthier food are seen as a big driver of innovation in Canada and around the world. This priority includes nutritional improvements, better digestibility, and the reduction or replacement of ingredients with negative health implications, like salt or sugar, through substitution or reformulation. It also provides expanded opportunities for plant-based ingredients, especially those that can be grown in Canada.

The focus on human health should be coupled with the ability to give consumers accurate, science-based information and not “Facebook health” in order for these types of products to earn public trust.

Clean label foods

Consumers are more aware of what they are feeding themselves, their children and their animals, and with a smartphone, information is at their fingertips.  That information may include perceptions shared on social media that are not always science-based. The clean label movement is driving the food and beverage processing sector towards products with fewer or no additives, as well as natural, clean, sustainable production, an opportunity that can be addressed through processing changes as well as product reformulation.

Clean labels include the reduction or replacement of specific ingredients – like sugar, trans fats, gluten, preservatives and additives – in response to allergies, health concerns or a general desire for healthier lifestyles.

Development of new products is particularly important for companies with legacy brands or whose products are commoditized to enable them to stay fresh in the marketplace.

Functional foods and novel ingredients

Consumer trends and preferences are changing away from historically nutrient deficient foods towards newer, more nutritionally dense foods. This shift provides opportunities for products with enhanced benefits, such as functional foods and beverages containing probiotics or antioxidants, for example, or new plant-derived proteins that can support increasingly popular diet trends, such as vegan or vegetarian eating.

Food safety innovation

Food safety was mentioned in all regions across Canada as an important innovation area. It is considered a “must”, however, and not a tool to be used for market advantage or differentiation. This consensus makes this theme a particularly ideal area for pre-competitive research in food and beverage processing. Pre-competitive research is the space where competing companies can work together toward a common, shared research goal.

Showing innovative processing technologies and product formulations are safe

Before a new processing technology or product formulation can be brought to market, it must be shown to produce food that is safe for consumers. New or novel technologies may fall outside of the current approved government regulatory framework for food safety, so they have to be independently tested and verified to ensure the end result is safe food. ‘Fresh’ food innovation is a case in point.

Many food additives contribute to inhibiting the growth of pathogens. As the chemistry of food is altered when sodium levels are reduced or when certain additives are eliminated, the need arises to show that the food product continues to be safe as reformulated.

Packaging innovations that extend shelf-life, enhance safety and quality attributes

Increasing shelf-life can help offset climate variables that provide either abundance or shortage of produce in any given year. There is considerable opportunity in changing or minimizing processing requirements to deliver quality that is like “fresh” in shelf stable products. Novel packaging can also help with shelf life extension, as can reformulating a product to have fewer ingredients but without compromising its performance characteristics.

Advanced detection methods for pathogens, adulteration and other risk factors

Opportunities for preventing product fraud were identified as a great opportunity for pre-competitive research in the sector. This includes preventing misidentification of ingredients and production of imitation or “knock-off” products that don’t come with the traceability assurances, quality and standards the originals do. Advanced and rapid detection methods for pathogens are also important, especially as new health threats emerge in the form of new pathogens, new strains of existing pathogens, or increasing antimicrobial resistance.

Innovative technologies that contribute to sustainable practices and climate change mitigation

Technological advances were seen as a strong driver of innovation and in opening up avenues for companies to improve processes, solve problems or overcome hurdles related to production or products, improve mechanization and automation, boost food safety, adapt to the changing climate, and overall, drive profitability.

Automation for higher productivity from labour and/or gains in yield and recovery

Labour was cited as a priority area in all regions of the country – from recruitment and cost to training and retention. Increased mechanization and automation of food processing facilities can offset the challenge presented by the need and cost to recruit and retain suitable labour. At the same time, automation and mechanization have the potential to increase productivity and output through better precision as well as to reduce waste and improve efficiencies. Automation leads to activities becoming more integrated, data-driven and technologically advanced with corresponding needs for different workplace skills and competencies.

Process improvements  for better quality and performance, higher efficiency/reduced  cost, and/or greater flexibility

Innovative technologies and  changing  processes  in  food  and  beverage manufacturing facilities can boost output and productivity, as well as increase product quality. By implementing new or improved processes, companies can also lower production costs – a key element of competitiveness – by reducing the volume of inputs they require, such as energy or water, for example.

Clean technologies that offer more efficient use of water and energy resources and/or reduced greenhouse gas emissions

A general transparency about where food comes from and how it is made is important to many consumers today. This expectation includes sustainable production that is both local and socially conscious, but most importantly, is environmentally responsible.

There is a need for clean technologies in food and beverage processing businesses that can lower the industry’s environmental footprint by reducing greenhouse gas emissions, using fewer energy resources, and making more efficient use of available water supplies. For example, a reduction in wasteful processes through implementation of a clean technology solution can decrease water use and improve water quality.

Reduced packaging and/or expanded application of biodegradable packaging or fully recyclable packaging

Engineering packaging to reduce the amount of material used, increase consumer convenience, and extend shelf life are all factors that contribute to sustainable production.  In order to achieve the circular economy, future packaging will need to be fully recyclable or compostable. Not only does this kind of innovation lessen the sector’s environmental  impact and boost its sustainability, but better management of packaging can also contribute to cost containment (using less, using alternate ingredients etc.) and reduced food waste.

As well, innovative smart packaging technologies can indicate improper conditions during distribution and active packaging can incorporate technology to reduce microbial growth. Innovative packaging can provide additional benefits like extended product shelf life, improved food safety and reduced loss through spoilage or breakage.

Value-added products and  processes for market growth and global competitiveness

There was general consensus amongst forum participants across Canada that there should be a greater emphasis on development of value-added products instead of simply selling commodities or primary processed products, whether to domestic or global markets. Achieving this differentiation through innovation will benefit farmers and consumers, but particularly also contribute to the growth and competitiveness of food and beverage processors. The real growth opportunity is to take a value-added product innovation introduced into the Canadian market and supply it to upscale consumers in global markets.

The changing global  trade environment – Brexit, the Trans  Pacific Partnership and the Comprehensive Economic Trade Agreement with European Union, for example – present new market opportunities for Canadian products in international markets. The Canadian brand is well thought of at home and abroad, so promoting “grown by “ or  “processed by” Canada is an opportunity for both domestic and export markets.

Developing innovative products utilizing commodity ingredients (e.g. dairy, pulses, grains,  produce) with a focus on those grown or produced in Canada

Participants expressed a need for more supply of and access to commodities and ingredients produced locally or at least in Canada. Many speciality ingredients required for niche market food products are not available in Canada and must be sourced from the United States. Food processors expressed their preference to buy in Canada due to the reliability of and ready access to the supply. Shorter supply lines can also lead to lower transportation  costs and the risk of delays at the border is eliminated.

Recovering greater value from waste streams and coproducts

Along with reducing the amount of waste generated overall, the possibility of being able to turn waste into viable by-products that could generate value was also identified as an innovation opportunity. Whey as a by-product of cheese production, for example, can be used by farmers as livestock feed but could also be turned into a value-added co-product with proper innovation.

Waste management is a significant cost for many food and beverage processors so not only could that expenditure be reduced, it could potentially be redirected into a revenue generating venture. An example of a Canadian success story is Canadian Coffee’s compostable coffee pods, where part of the container is made from recycled coffee bean waste.

Extending the value of food ingredients through non-food applications

Most agricultural commodities are intended for human food or animal feed end uses. However, there are components and derivatives that often have potential non-food applications. Examples are bioindustrial products like environmentally friendly lubricants and oils, automotive parts, and paints that are manufactured from plant-based renewable inputs rather than petroleum. More advanced innovation could find non-food applications for specific product components, like protein, collagen, and targeted biocompounds that can be extracted for high-value specific end use markets such as cosmetics or pharmaceuticals.

Other roles for CFI

In addition to identifying priorities that can be directly addressed through research and innovation, forum participants across the country also expressed how they need support for driving research and innovation in their enterprises.

Asset mapping and building awareness

A common theme across all forum events was lack of awareness of the resources and expertise already in place in the food and beverage processing sector across Canada. CFI has an opportunity to play a leading role in the initial development and ongoing maintenance and improvement of a national asset map, as well as raising awareness of the asset inventory. Cataloguing an accessible inventory of food and beverage processing projects undertaken in Canada is one step to increasing awareness and making the results of publicly funded food and beverage processing research more widely known.

The success of offering an accessible, online database of research resources and project results depends on keeping it up to date and making it widely known to the food and beverage community in Canada so that it is used extensively.

Collaboration and networking

Clearly there is a need for greater collaboration and networking in the sector. Canada’s food and beverage processors tend to be in one silo and university and tech centre researchers in another. There is a need to break down these silos and increase the frequency and quality of exchanges among academic and public researchers and with processors and merchandisers in the innovation space.

However, it is also clear that a prerequisite for collaboration is that companies  must first be connected through a well-functioning ecosystem. In this context, they must be connected to the asset map identified previously. More importantly, Canadian food and beverage companies need new support systems for connecting to each other in a way that will create relationships that will lead to collaborative R&D projects and innovative outcomes.

Forum participants across the country cited a greater need to build collaboration among stakeholders with common needs to boost efficiency and make available resources go further. Suggestions include:

  • Annual national innovation event led by CFI that gives Canada’s food innovators a reason to participate and come together, offering opportunity to learn, be inspired, and to network.
  • CFI-led innovation  roundtables convened for a specific target group in the same subsector or region to enable networking, idea-sharing and convergent thinking around solutions that could be pursued collaboratively. A key to the roundtable concept is to enable cross-fertilization between food business minds bringing market and consumer insights on the one hand, and inter-disciplinary science and engineering minds on the other.
  • Regular web-based learning opportunities around key topic areas common to all types of food and beverage processors (e.g. labelling,  packaging,  HR, funding opportunities etc.). This focus could provide a platform for more regular interaction beyond the annual face-to-face event. A What’s App group, administered by CFI, could complement this connectivity, offering on-going, instant communication in the sector.
  • Expanding beyond the food processing community, CFI could arrange sessions to learn best practices from other economic clusters and could reach out beyond Canadian borders to identify and connect with food start-ups in other countries to recruit them for Canada’s food and beverage ecosystem

Representing industry  to government

Beyond the role of facilitating collaboration within the sector, it was clear that industry and the research community supports the emerging role that CFI plays as the lead agency to represent Canada’s food and beverage processing industry in policy and program discussions with federal and provincial governments on matters relating to R&D and innovation.

Through its relationship with provincial food and beverage processing associations, CFI has access to over 2,000  Canadian owned companies in the industry and has connections to research facilities in all regions of Canada. This network, along with CFI’s singular purpose to drive innovation within the Canadian industry, enables CFI to be a key player in supporting economic prosperity for Canada through this vital industry.

CFI has a challenge in implementing solutions to the needs that forum participations identified. The challenge is limited resources. To undertake  an expanded range of activities, there is seed capital needed for development of relevant products and services and a means must be developed in step to monetize the value delivered in order for the products and services to be sustainable.