> **来源：[研报客](https://pc.yanbaoke.cn)** # Future of Food 2.0 Capturing growth in a transforming global food ecosystem # PwC This publication has been developed in collaboration between Strategy&, PwC's global strategy consulting business, alongside PwC industry and function experts. Together, we transform organizations by developing actionable strategies that deliver results. At PwC, we help clients build trust and reinvent so they can turn complexity into competitive advantage. We're a tech-forward, people-empowered network with more than 364,000 people in 136 countries. Across audit and assurance, tax and legal, deals and consulting we help clients build, accelerate and sustain momentum. Find out more at www.pwc.com. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details. www.pwc.com # Contacts # Australia Anthony Goldsworthy Partner, PwC Australia +61-435-851-445 anthony.goldsworthy @au.pwc.com # Germany and Austria Harald Dutzler Partner, Strategy & Austria +43-664-5152-904 harald.dutzler@pwc.com # South Africa Andrew Dale Partner, PwC South Africa +27-82-325-3932 a.dale@pwc.com # Brazil Fabio Pereira Director, PwC Brazil +55-19-97145-9405 fabio.pereira@pwc.com # Ireland David McGee Partner, PwC Ireland +353-86-268-1522 david.a.mcgee@pwc.com # Switzerland Stephan Laux Director, PwC Switzerland +41-79-753-25-38 stephan.laux@pwc.ch # Canada Elisa Swern Partner, PwC Canada +1-416-723-1229 elisa.swern@pwc.com # Middle East Aya Hallak Partner, Strategy& Middle East +966-55-740-2586 aya.hallak@pwc.com # The Netherlands Stuti Sethi Director, Strategy& Netherlands +31-6-2380-2271 stuti.sethi@pwc.com # France and Maghreb Jonathan Le Henry Partner, Strategy& Maghreb Region +212-6-61-08-25-07 jonathan.le-henry@pwc.com # New Zealand Peter Chambers Partner, PwC New Zealand +64-21-404-015 peter.x.chambers@pwc.com # United States Carla DeSantis Partner, PwC United States +1-617-290-6941 carla.desantis@pwc.com # About the authors Harald Dutzler is a Partner at Strategy& in Vienna. He leads the retail and consumer markets practice for Strategy& Europe and is PwC's Global Sector Leader for Consumer Goods. His primary focus lies on growth strategies, transformation, operations strategy development and organizational design in food and beverage value chains (from input to recycling) and in non-food supply chains. Stuti Sethi is a Director at Strategy& in Amsterdam. She leads PwC's Food Systems agenda, focusing on reinvention and transformation across the global food system. Stuti manages a global core and subject-matter expert team to deliver impact for clients worldwide. Her primary focus is on growth and sustainability strategy in the food system. Janika Albrecht is a Manager at Strategy& in Berlin. She focuses on sustainability strategy and transformation topics in the retail and consumer goods industry. Leo Polwein is a Senior Associate at Strategy& in Berlin. He focuses on technology- and sustainability-related projects in the food ecosystem. Julia Rödel is an Associate at Strategy& in Düsseldorf. She focuses on growth strategy and transformation topics in the retail and consumer goods industry. Pauline Holt is an Associate at Strategy& in Munich. She focuses on strategic sustainability topics in the retail & consumer goods industry. We also want to thank the interview partners, Shokoofeh Manesh and Jakob von Baeyer for their great contribution to the study. # TABLE OF CONTENTS # Executive summary 5 # 1. Why reinvention is now a business imperative 7 # 2. Mapping the food ecosystem's emerging growth areas 9 2.1 Key growth areas 9 2.2 How We Grow 12 2.3 How We Produce 17 2.4 How We Consume 21 # 3. Reinvent to capture growth: how food companies can adapt for the next decade 28 # Conclusion: Choose, Connect, Capture 33 # EXECUTIVE SUMMARY This "Future of Food 2.0" report maps and quantifies the 2035 potential of nine emerging growth areas across the food ecosystem. It builds on the recent PwC article "Reconfiguring the global food system", which sets out a vision for a more resilient and future-proof model. The report draws on in-depth data analysis, and insights from our interviews with 30 senior executives worldwide at companies and co-operatives across the food ecosystem. Through these interviews, we explored executives' perspectives on the major structural trends shaping the food ecosystem and examined how their organizations are unlocking the growth areas they see as most relevant (see next page). # 46 Our research identifies $3.1 trillion in emerging growth areas by 2035, but capturing this value requires a fundamentally different approach to decision-making. Leaders must adopt scenario-based planning, use differentiated KPIs for early-stage ventures, and build partnerships that share risk while accessing capabilities that don't exist in-house." Harald Dutzler Partner at Strategy& # Key findings of this report for 2025 - 2035 1. Healthy eating, rapidly changing consumer expectations and climate and environmental change were identified by interviewees as the three most important trends impacting their business and the food system over the next decade, just ahead of AI and technology 2. We have identified 9 high growth areas: Health and Nutrition, Convenience, Shopper Experience, Advanced Food Processing, Alternative Ingredients and Proteins, Sustainable Packaging, Next-Gen Agricultural Inputs, Connected Growing Systems and Agri Infrastructure 3. Growth area revenues are expected to rise to $3.1 trillion by 2035, expanding nearly 4x faster than the estimated$ 9.9 trillion value of the entire food ecosystem in 2035 4. The largest growth areas are closer to the consumer, yet increasing pressure to innovate and build resilience demands transformative growth and significant investment in farming and food production 5. At $800 billion, Health and Nutrition is the single largest growth area, with potential to reshape ingredient choices and ripple effects into more resource-efficient and sustainable production 6. Reducing financial and operational risks for farmers is key to driving adoption of innovations in How We Grow our food (\(400 billion) and creating a more resilient food ecosystem 7. Innovating How We Produce ($680 billion) can ease pressure on land use and supply chains with automation, advanced processing, and alternative ingredients reshaping cost structures and what we eat 8. Most interviewees pointed to unclear business model economics as a critical brake on innovation beyond the core business, making it hard to secure and sustain investment long enough to scale new business models 9. There was broad consensus among interviewees that no single player can win alone when it comes to new growth areas. Ecosystem collaboration is seen as a key prerequisite to accessing the diverse capabilities needed for unlocking and scaling breakthrough growth opportunities 10. Capturing value in the food system requires companies to choose where to play, drawing on a deep understanding of long-term trends and scenario-based analysis, connect with others to share risk and close capability gaps, and maintain a steady course with decisive leadership to achieve scalable growth # SECTION 1 # 1. Why reinvention is now a business imperative The global food system is entering one of the most consequential decades in its history. Climate volatility, geopolitical shocks, and resource constraints are disrupting production and supply chains, while demand continues to rise. Feeding a population that will exceed 9 billion mid-century will require annual production of crop calories to increase by more than $50\%$ compared to 2010.<sup>1</sup> At the same time, climate change and land degradation are driving the loss of over 100 million hectares of productive land each year<sup>2</sup>, while nearly $70\%$ of the world's population will live in urban areas<sup>3</sup>. Meeting future demand will require more than just higher yields: land restoration and new food production methods will be essential to sustain future generations. 1 World Resources Institute (WRI), "Creating a Sustainable Food Future: A Menu of Solutions to Feed Nearly 10 Billion People by 2050", 2019, https://research.wri.org/sites/default/files/2019-07/creating-sustainable-food-future_2_5.pdf 2 https://www.unccd.int/news-stories/press-releases/least-100-million-hectares-healthy-land-now-lost-each-year 3 https://www.un.org/development/desa/en/news/population/2018-revision-of-world-urbanization-prospects.html Yet the same forces that are straining the system are also creating new opportunities. Across interviews with 30 senior executives from leading companies worldwide, one message was clear: value is in motion, and companies that recognize and act on these dynamics early will play a disproportionate role in securing their own growth and supporting a more resilient food ecosystem. Executives pointed to the following trends that will shape the next decade: - Healthy eating, moving from a niche concern to a mainstream demand driver, - Rapidly changing consumer expectations, from "social-to-shelf" velocity to frictionless convenience at affordable prices, - Climate and environmental change, which is transforming agriculture today and is increasingly translating into higher costs for consumers. These trends are not abstract. For consumer-centric players, expectations are rising on two fronts at once. Consumers still want frictionless, "right here, right now" access to food, but increasingly they also expect that food to do more, by offering functional benefits and supporting their overall health and wellbeing. As demand grows, the boundary between food and pharma is blurring, with propositions anchored less in categories and more in health outcomes. For many incumbents, this puts industry convergence firmly on the agenda, forcing a rethink of portfolios, partnerships and the capabilities needed to compete in a health-led food ecosystem. For farmer-centric companies such as seed and fertilizer producers or large agricultural enterprises, shifting weather patterns, soil degradation, and resource scarcity are already tangible business challenges. The question, then, is how to create stronger links across the food ecosystem so that pressure points for farmers and growth opportunities for consumer-centric companies reinforce rather than undermine each other. This report is designed to help food ecosystem players navigate this turning point in two steps: - Section 2 maps where growth will occur, identifying nine major growth areas across the entire ecosystem - Section 3 translates these opportunities into what companies must do, drawing on our 30 executive interviews to outline the capabilities, partnerships, and leadership choices required to unlock growth in an increasingly uncertain environment In short, this report is both a map of where the growth lies, and a guide to how companies can capture it. # SECTION 2 # 2. Mapping the food ecosystem's emerging growth areas # 2.1 Key growth areas To understand where the biggest opportunities will emerge over the next decade, we mapped the food ecosystem's most dynamic growth areas, where value is shifting fastest as companies respond to new technologies, changing consumer expectations and climate pressure. We identified nine growth areas across the food ecosystem, from input to recycling and including rapidly emerging sectors such as Health and Nutrition, and Alternative Ingredients and Proteins (see Exhibit 1). # EXHIBIT 1 Key growth areas and sub-segments in the food ecosystem These business opportunities will translate into emerging and shifting growth areas across the entire food value chain <table><tr><td>How We Consume Health and Nutrition • Functional foods and beverages • Supplements • Personalized nutrition and diagnostics</td><td>How We Consume Convenience • Food delivery • Quick commerce • Meal kits • Major smart kitchen appliances</td><td>How We Consume Shopper Experience • Retail media • Advanced automated checkouts • Agentic food commerce</td></tr><tr><td>How We Produce Advanced Food Processing • Automated food processing systems • High-pressure processing (HPP) • 3D food printing</td><td>How We Produce Alternative Ingredients and Proteins • Plant-based proteins • Fermentation-based products • Cultivated (lab-grown) meat • Insect proteins</td><td>How We Produce Sustainable Packaging • Recyclable packaging • Biodegradable packaging • Compostable packaging</td></tr><tr><td>How We Grow Next-Gen Agricultural Inputs • CRISPR-edited crops • Biological agriculture • Methane-reducing feed additives</td><td>How We Grow Connected Growing Systems • Precision equipment and automation • Digital sensing and data platform • Farm management software • Regenerative agriculture</td><td>How We Grow Agri Infrastructure • Agrivoltaics • Solar-powered cold storage • Controlled environment agriculture</td></tr></table> Total estimated size by 2035: $3.1tn (CAGR 7.7%) How We Consume Shopper Experience Retail media - Advanced automated checkouts - Agentic food commerce How We Produce Sustainable Packaging Recyclable packaging Biodegradable packaging - Compostable packaging How We Grow Agri Infrastructure - Agrivoltaics Solar-powered cold storage - Controlled environment agriculture # Methodology These growth areas are a curated selection based on insights from external market analysis, PwC's global expert network and 30 executive interviews. To assess their future potential, we projected the growth trajectory of each area over the next decade based on total forecast revenues. This analysis drew on external market estimates, including analyst reports, industry association data, and academic research, in addition to insights from the executive interviews and PwC's global expert network. Using consistent value-chain-based sizing logic, we projected revenues for each growth area in 2025, 2030, and 2035, to provide a comparable view of where growth is likely to materialize. # EXHIBIT 2 Projected market size of growth areas, 2025-2035 (in $ billion)1 The growth areas differ in their market size Total estimated size by 2035: $3.1tn (CAGR 7.7%) <table><tr><td>How We Consume Health and Nutrition $800bn</td><td colspan="2">How We Consume Shopper Experience $630bn</td><td colspan="2">How We Produce Sustainable Packaging $430bn</td></tr><tr><td rowspan="2">How We Consume Convenience $630bn</td><td rowspan="2">How We Grow Agri Infrastructure $220bn</td><td>How We Grow Connected Growing System $90bn</td><td>How We Produce Advanced Food Processing $80bn</td><td rowspan="2">How We Produce Alternative Ingredients and Proteins $170bn</td></tr><tr><td colspan="2">How We Grow Next-Gen Agricultural Inputs $90bn</td></tr></table> 1. For the Convenience growth area, our sizing, as an exception, captures only the value added by convenience (i.e., the margin between input costs such as ingredients or goods and consumer prices) rather than total revenues to ensure comparability and avoid double counting. Source: Strategy& analysis Our analysis suggests that, while the value of the overall food ecosystem is expected to grow yearly by $2.1\%$ to $9.9$ trillion in 2035, $^4$ the nine growth areas will expand much faster: rising from $\$1.5$ trillion in 2025 to $\$3.1$ trillion in 2035 (CAGR $7.7\%$ , see Exhibit 2). We group the growth areas into three broad clusters of the food ecosystem – How We Grow, How We Produce and How We Consume (see Exhibit 2). In sections 2.2 to 2.4, we discuss each cluster in turn and the three growth areas within it: How We Grow: $150 billion (2025) – $400 billion (2035) How We Produce: $290 billion (2025) - $680 billion (2035) How We Consume: $1,060 billion (2025) - $2,060 billion (2035) When viewed this way, the figures reflect the overall imbalance in the ecosystem: revenues are heavily weighted toward retail, even as increasing pressure to innovate and become more sustainable drive transformative growth closer to product and farm level. Around $90\%$ of the projected value in 2035 reflects a shift from traditional to emerging sub-segments (for example, conventional to CRISPR-edited crops or animal-based to alternative proteins). The remaining $10\%$ represents additive growth, generated by sub-segments that do not primarily replace existing products, including methane-reducing feed additives, dual land use for agriculture and solar energy (agrivoltaics), and personalized nutrition and diagnostics. Two additional lenses which cannot be meaningfully quantified but are critical to understanding how quickly these growth areas will develop are system-wide catalysts that accelerate innovation, and regional differences in adoption. - System-wide catalysts, such as digital technology and AI, financing, and supportive government policy, influence multiple parts of the ecosystem at once, accelerating innovation from real-time farm analytics to personalized nutrition. Other catalysts, such as efforts to strengthen food security, reduce food waste and increase circularity, drive adoption of solutions such as precision agriculture and solar-powered cold storage. Ecosystem-wide services such as carbon accounting, insurance, and digital traceability infrastructure reinforce these shifts by giving companies the tools to navigate compliance, unlock financing, and demonstrate impact. Together, these system-wide forces shape how quickly new solutions can scale and how effectively they translate into sustained impact. They also represent significant value in the food ecosystem, although this value has not been quantified in this study as part of the growth areas assessment. - Regional differences influence where growth areas are developing. In the US, for instance, innovation is driven by breakthroughs in biotechnology, AI-enabled food systems, and the adoption of GLP-1 medications<sup>5</sup>, a key growth accelerator across the health and nutrition sector. In Europe, by contrast, innovation is often regulation-driven, with a strong focus on sustainable packaging, circularity, and traceability. In the Middle East and China, concerns about food security underlie major investments in controlled environment agriculture (e.g., greenhouses). Meanwhile, in many parts of Africa, diets are shifting to include more protein (e.g. poultry and fish), and Asia is emerging as a hub for digital convenience and rapid commerce. South America is one of the world's most important suppliers of food, fiber, and bioenergy, playing a strategic role in global food and energy security. At the same time, South America is emerging as a global testbed for large-scale agricultural innovation, from digital farming and precision agriculture to biological inputs and soil regeneration, aimed at boosting productivity while decoupling growth from environmental impact. # 2.2 How We Grow Reinventing How We Grow food starts on the farm. Growth areas in this part of the ecosystem will only scale if they solve the farmer's everyday challenges: creating better growing conditions, reducing input costs, and increasing efficiency and productivity. In our analysis, we focus on three growth areas that directly address these pain points and together underpin the $400 billion How We Grow market size by 2035 (see Exhibit 3, next page): - Next-Gen Agricultural Inputs - Connected Growing Systems - Agri Infrastructure # EXHIBIT 3 # Growth areas in How We Grow <table><tr><td>Growth areas</td><td>Next-Gen Agricultural Inputs</td><td>Connected Farming Systems</td><td>Agri Infrastructure</td></tr><tr><td>Definition</td><td>Biotechnological and biological inputs transforming agriculture toward greater resilience and efficiency</td><td>Smart farming systems integrating automation, data, and regenerative practices to optimize productivity and sustainability</td><td>Renewable energy integration, efficient cold storage, and controlled growing environments</td></tr><tr><td>Sized sub-segments</td><td>CRISPR-edited crops Biological agriculture Methane-reducing feed additives</td><td>Precision equipment and automation Digital sensing and data platform Farm management software Regenerative agriculture</td><td>Controlled environment agriculture Agrivoltaics Solar-powered cold storage</td></tr><tr><td>Growth drivers</td><td>Climate-driven production losses Supportive policies Consumer preference for sustainable food production Advances in biotechnology</td><td>Need to improve yields and efficiency amid climate, cost, labor and food security pressures Digitalization and cheaper IoT/AI Policies and investors</td><td>Weather volatility and supply-chain disruptions Advances in solar, automation, and cooling technologies Energy demand and decarbonization goals</td></tr><tr><td>Challenges</td><td>Regulatory uncertainty and lengthy approval processes R&D costs and limited scalability of biological products Farmer adoption barriers due to cost, awareness, and perceived risk</td><td>High upfront investment and unclear ROI limiting adoption Raising awareness and technological adoption in rural areas Lack of clear certification standards, offtake agreements and market recognition</td><td>High capital intensity and long payback periods Dependence on specialized maintenance, reliable energy storage, and skilled labor Land-use competition, regulatory hurdles, and grid integration constraints</td></tr><tr><td>Market size in billion USD and CAGR</td><td colspan="2">+25% 10 40 90</td><td>+7% 110 160 220</td></tr></table> Source: Strategy& analysis # Next-Gen Agricultural Inputs and Connected Growing Systems Farmers are increasingly adopting new practices such as precision agriculture, regenerative agriculture and biological inputs (e.g., bio stimulants), to improve yields while reducing reliance on synthetic fertilizers and pesticides – both major cost drivers and environmental liabilities. Precision agriculture technologies such as sensor-guided irrigation and AI-based crop analytics enable more targeted input use, lowering operating costs and increasing resilience to climate volatility. Regenerative agriculture is gaining traction to restore soil health and potentially unlock carbon revenue streams, although adoption still depends heavily on clear economic benefits and transition support. # Agri Infrastructure Within How We Grow, Controlled Environment Agriculture (CEA) is by far the largest sub-segment, driven primarily by greenhouse horticulture, which we estimate will reach annual revenues of $220 billion by 2035. Greenhouses are becoming an essential tool for climate resilience and food security. A Nature study based on satellite data revealed 1.3 million hectares of global greenhouse area in 2019, an area nearly the size of Northern Ireland or Connecticut, with China accounting for $60\%$ of total coverage[6,7]. Their appeal is rising as extreme weather, water scarcity, and supply instability increase the need for predictable, protected production systems, even though energy use and emissions remain a challenge in some greenhouse systems. At the same time, the sector is being reshaped as automation becomes essential amid severe labor shortages.[8] By contrast, indoor and vertical farms remain small in scale due to higher energy and labor costs, reinforcing that greenhouses will remain the backbone of controlled-environment food production in the decade ahead. Although not sized in this study, aquaculture represents another fast-growing controlled production system, increasingly important for meeting global protein demand as terrestrial agriculture faces mounting climate and land constraints. Another rapidly emerging opportunity is the expansion of cold-chain infrastructure, particularly through solar-powered cold storage in developing markets for perishable food. Across sub-Saharan Africa, the World Bank estimates that 7.4 million smallholder farmers lack access to adequate cold storage facilities.[9] In Kenya less than $20\%$ of perishable food is refrigerated, leading to post-harvest losses of up to $40\%$ .[10] In this context, companies like SokoFresh are pioneering off-grid "cold-storage-as-a-service" models, combining solar-powered cooling units with market-linkage solutions for smallholder farmers. Each installation generates commercial returns, reducing post-harvest food losses and increasing farmers' incomes by up to $30\%$ .[11] 6 https://earthobservatory.nasa.gov/images/152874/a-greenhouse-boom-in-china 7 https://www.nature.com/articles/s43016-024-00985-0 8 https://media.rabobank.com/m/4e9a7bf2ad664c72/original/Global-greenhouse-update-2025.pdf 9 https://documents1.worldbank.org/curated/en/099235110062231022/pdf/P175150063801e0860928f00e7131b132de.pdf 10 https://eepafrica.org/documents/Sector-Briefs/cold-chain-storage-market-assessment-2023.pdf 11 https://set-alliance.org/set-resources/off-grid-cold-storage-as-a-service-for-farmers-in-kenya # Vertical integration as a growth model in African agribusiness Our interviews with executives from South African agribusinesses show that some players aim to build vertically integrated business models that allow them to own and develop end-to-end supply chains – often starting from scratch due to limited legacy infrastructure. This approach is essential for controlling quality, reducing inefficiencies, and ensuring food security, especially as rising incomes shift consumer demand toward higher protein diets. However, constructing these supply chains is complex due to intense inter-country competition and regulatory uncertainty. Technology is a key enabler: companies are investing in mechanization and automation, leveraging affordable Chinese and Indian equipment to make mechanization accessible to smaller farmers. # Farmer adoption is a key growth driver – and key challenge Unlocking more than \(400 billion in future growth depends largely on the adoption decisions of the world's 608 million farmers - 84% of whom cultivate less than two hectares.\(^{12}\) In practical terms, the speed at which farmers embrace change ultimately determines the trajectory of nearly every farming-related sub-segment, from CRISPR-edited crops to precision agriculture and regenerative practices. Yet farmer adoption remains difficult. Globally, \(90\%\) of farms are family-run\(^{13}\), with practices refined over years of experience. For many, adopting new technologies represents not just a financial risk but requires new skills, trust, affordable solutions with viable payback periods, and support systems. At the same time, farmers face mounting external pressures: volatile commodity prices, rising input costs, and increasingly extreme weather, while being asked to transition toward more sustainable and often more complex production systems. In interviews, executives running cooperatives and farmers' associations identified five critical levers that accelerate farmer adoption (see Exhibit 4), ranging from economic incentives to increasing demand for sustainably-farmed products. The impact and effectiveness of these levers depend heavily on the local policy, farming and regulatory context. For example, greater use of gene-edited crops, which can increase pest or drought resistance and enable additional revenue streams for farmers through higher-value non-food applications of crops, relies as much on the local political climate as on the right agricultural conditions. In Europe, unlike in the US, adoption of the CRISPR/Cas9 gene editing system hinges on regulatory clarity and public acceptance, with the political debate on deregulation of new genome techniques still unresolved in late 2025.[14] 12 https://www.sciencedirect.com/science/article/pii/S0305750X2100067X? 13 https://www.sciencedirect.com/science/article/pii/S0305750X2100067X? 14 https://www.chemistryworld.com/news/gene-edited-crops-set-to-arrive-in-england-but-eu-remains-divided-on-them/4021687 ARTICLE For farmers, every decision carries real financial risk and affects their livelihood – which is why showing clear results in the field is essential for adoption." Alexander Tokarz, Head of Group Strategy at Syngenta # EXHIBIT 4 Major levers to enable innovation in farming Economic incentives - Cost-sharing and input rebates - Long-term contracts - Sustainability-linked loans - Shared equipment (drones, smart tractors) Predictable, supportive regulation Uniform metrics and measurement standards for biological inputs - Subsidies for sustainable practices Data-based evidence and demonstration - Pilot farms with repeatable results Outcome based approaches with rewards linked to e.g.,water retention or biodiversity Collaboration and capability building Collaboration across stakeholders to share costs and risks - Training for new technologies (e.g., drones and precision tools) Improved market demand signals - Consumer educational campaigns and advertising on reg. and sustainable agriculture - Branding and certification for sustainable products # 2.3 How We Produce Food production is undergoing one of the most profound technological shifts in decades. Advances in automation, biotechnology, and efforts to improve supply chain resilience (e.g., for cocoa) are reshaping how food is made and determining which players can grow profitably in an increasingly volatile environment. In this section, we examine the most dynamic growth areas which underpin the $680 billion How We Produce market size by 2035 (see Exhibit 5, next page): Advanced Food Processing - Alternative Food Ingredients and Proteins - Sustainable Packaging Key challenges across growth areas include strict and evolving regulations (e.g., for cultivated meat), high costs and technical hurdles in scaling production for technologies such as bioreactors, and limited consumer acceptance of alternative materials and food technologies. Early automation was about swapping people for robots. The real value came once we stopped thinking that way and focused on where technology could help people do their jobs better. That's where productivity – and capability – really took off." Tom Woodbridge, CEO at Beak & Johnston # EXHIBIT 5 # Growth areas in How We Produce <table><tr><td>Growth areas</td><td>Advanced Food Processing</td><td>Alternative Ingredients and Proteins</td><td>Sustainable Packaging</td></tr><tr><td>Definition</td><td>Cutting-edge technologies that improve precision, consistency, and innovation in food production</td><td>Proteins and functional ingredients from plants, fermentation, cultivated cells or by-streams that replicate conventional ingredients</td><td>Packaging that reduces environmental impact through improved material efficiency, recyclability, biodegradability, or compostability</td></tr><tr><td>Sized sub-segments</td><td>• Automated food processing systems • High-pressure processing (HPP) • 3D food printing</td><td>• Plant-based proteins • Fermentation-based products • Cultivated (lab-grown) meat • Insect proteins</td><td>• Recyclable packaging • Biodegradable packaging • Compostable packaging</td></tr><tr><td>Growth drivers</td><td>• Automation needed due to labor gaps and rising safety/quality standards • Advances in robotics and AI improving efficiency • Demand for natural, preservative-free products</td><td>• Demand for sustainable and ethical protein • Biotech and processing advances improving taste and texture • Regulatory support, food security and investment momentum</td><td>• Regulatory pressure • Advancements in materials science • Rising consumer awareness</td></tr><tr><td>Challenges</td><td>• High capital costs and complex integration for legacy plants • Limited 3D printing scalability • Regulatory and consumer barriers to novel technologies</td><td>• Sensory gaps vs. animal proteins • High production costs and scale limits (especially cultivated/fermentation) • Regulatory uncertainty and consumer scepticism</td><td>• High production costs and limited recycling infrastructure • Performance trade-offs • Inconsistent global standards</td></tr><tr><td>Market size in billion USD and CAGR</td><td colspan="2">+10% 30 40 80</td><td>+7% 290 430</td></tr></table> Source: Strategy& analysis # Advanced Food Processing It is estimated that the automation market in food processing will more than double in size to around $65 billion by 2035, as manufacturers continue to integrate robotics and IoT systems to optimize production lines. A 2025 survey of mostly US companies shows that $43\%$ of food and beverage manufacturers currently invest between $26\%$ and $50\%$ of their total equipment budgets in digital and automation projects.[15] Much of this investment is aimed at near-term gains – reducing labor, energy, and material costs – rather than radically reinventing production models. Tom Woodbridge, CEO of food manufacturer Beak & Johnston, highlighted a shift toward smaller, collaborative robots (“cobots”) that work alongside employees to improve manual handling, safety, and productivity. This evolution reflects a move toward human-machine collaboration instead of full automation, requiring a smaller but more skilled workforce. Executives told us that their automation journeys are already underway. As technology matures and the economics of automation improve (facilitated by government incentives), factories in environments such as China and Thailand are delivering higher output with leaner staffing than those in higher-cost, more regulated regions. Beyond automation, emerging processing technologies such as high-pressure processing (a non-thermal method that extends shelf life) and 3D food printing are being explored, but most interviewees expect them to remain niche, focused on specific use cases rather than broad industry standards. # Sustainable Packaging Globally, there is a shift toward recyclable, biodegradable, and compostable packaging solutions, which together are estimated to reach a market value of \(430 billion by 2035.[16] Reaching this scale is not guaranteed: food safety requirements, high investment needs, and limited supply of next-generation materials remain real constraints that could slow adoption. Nevertheless, for commercial and legal reasons, food manufacturers must respond. In Europe, the EU Packaging and Packaging Waste Regulation (PPWR) requires all packaging to be recyclable by 2030.[17] Interviewees consistently noted that reducing packaging has become a top agenda item, not only to meet regulatory requirements but also to manage rising materials costs. A Strategy& study on sustainable packaging estimates that companies can cut packaging costs by up to $30\%$ through various means, including lightweighting and working with partners in their value chain to reduce secondary and tertiary packaging. $^{18}$ A critical strategic question highlighted by several interviewed executives is how to redesign pack-price architecture – balancing consumer demand for convenient, on-the-go formats with the shift toward more sustainable materials. # Alternative Ingredients and Proteins Manufacturers of plant-based, cell-cultured and fermentation-based meat, fish, egg and dairy products raised $1.1 billion in 2024, with around $60\%$ flowing into fermentation, $28\%$ into plant-based, and $13\%$ into cultivated solutions.[19] We estimate conservatively that alternative proteins will represent around $5\%$ of global protein revenues by 2035, up from around $2\%$ today. While the early "alternative protein boom" has cooled, with the sector facing clear headwinds (see Exhibit 5), our interviews indicate that the underlying drivers – including health, sustainability, and rising food-security concerns – remain intact, particularly as countries such as China accelerate investment in precision fermentation. Our analysis of alternative proteins focuses on three sub-segments: plant-based proteins, fermentation, and cultivated meat (see Exhibit 6). Across our interviews, precision fermentation emerged as an area with a lot of potential, particularly in functional foods and the replacement of ingredients facing supply challenges (e.g., cocoa butter, saffron). While the sector is still early in commercialization, companies are rapidly scaling into mainstream categories like meat, egg, and dairy alternatives. Key challenges include high energy use along with regulatory approval, scaling industrial bioreactor capacity, cost reduction, and consumer acceptance. # Upcycled Ingredients and Ingredient Substitution are another huge opportunity New technologies and processes are creating opportunities for companies to upcycle by-products previously discarded as waste into food- and non-food products such as biofuels. Upcycled ingredients can be obtained from plant-based sources such as fruits, vegetables and grains, as well as meat, fish, and dairy products. For example, Sean Molloy, CEO of Tirlán and one of our interviewees, highlighted the shift in the role of whey. Once a low-value by-product of cheese and Greek yogurt production, it has become a high-demand ingredient driven by the rise of protein-rich diets. In many cases, whey now generates more economic value than the cheese or yogurt it originates from. # EXHIBIT 6 Sub-segments of alternative proteins <table><tr><td></td><td>Plant-based proteins</td><td>Fermentation</td><td>Cultivated meat</td></tr><tr><td>Definition</td><td>Proteins derived from plants used to replace animal-based products in terms of taste and texture</td><td>Use of microorganisms to produce proteins and ingredients via three approaches: traditional (e.g., tempeh), biomass (e.g., mycoprotein/Quorn), or precision fermentation</td><td>Meat grown directly from animal cells in bioreactors, without raising animals</td></tr><tr><td>Technology maturity</td><td>Highly mature</td><td>Moderate to high maturity, depending on sub-type</td><td>Early stage</td></tr><tr><td>Key inputs</td><td>Soy, pea, wheat, seaweed</td><td>Bacteria, yeast, fungi</td><td>Cell lines</td></tr><tr><td>Current developments</td><td>• Largest segment within alternative proteins with c. $45 billion market size based on Euromonitor data • Supported by government guidelines (e.g., EU Farm to Fork, UK Eatwell Guide) • Major retailers such as Tesco expanding private-label ranges within plant-based products</td><td>• Total private funding of $0.7 billion in 2024 • Precision fermentation, the newest and most promising method, offering scalable protein production with up to 95% less land use and nearly no water consumption • Enables production of fats, sweeteners, vitamins, enzymes, offering replacement of scarce ingredients (e.g., cocoa butter, saffron) within plant-based products</td><td>• Global investment reached $3.1 billion in 2025 • Advancing from concept to commercialization; products now sold by seven companies in Singapore, US, and Australia (regulatory approval granted)</td></tr></table> 1. https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(25)01201-2/abstract 2. https://www.beuc.eu/farm-fork-strategy-consumer-view?; https://assets.publishing.service.gov.uk/media/5bbb790de5274a22415d7fee/Eatwell_guide ColourEdition.pdf 3. https://gfieurope.org/precision-fermentation/ 4. https://www.morganstanley.com/insights/articles/fermentation-technology-surpass-30-billion-2030 5. https://gfi.org/science/the-science-of-cultivated-meat/ 6. https://gfi.org/resource/cultivated-meat-seafood-and-ingredients-state-of-the-industry/ Source: The Lancet<sup>1</sup>, BEUC<sup>2</sup>, Morgan Stanley<sup>3,4</sup>, GFI Europe<sup>5,6</sup> This shift is prompting companies across the food ecosystem to reassess the potential of by-products – from spent brewers' grains to cocoa pod husks, to food waste repurposed as feedstock for precision fermentation. Ingredient substitution is increasing as companies take action to address commodity price volatility and the impacts of weather volatility on supply. Cocoa and coffee are prominent examples. Price volatility has prompted manufacturers to use substitutes like carob, or to reformulate to use less cocoa and more sugar, often at the expense of nutritional quality. Cocoa, surged from around $4,200 per ton to nearly$ 12,000 in 2024, before easing back to roughly $5,500 by late 2025[20,21,22]. In coffee, substitutions range from chicory-based blends to alternative beverages such as energy drinks.[23] These shifts in ingredient use require companies to adapt sourcing practices, develop new suppliers and ingredient types, and in some cases reassess manufacturing equipment and production lines to handle different ingredient properties and pre-processing requirements. # 2.4 How We Consume Changing How We Consume food opens one of the most powerful opportunities in the global food ecosystem. As consumer expectations shift rapidly toward healthier choices, greater convenience, personalization, and seamless omni-channel experiences, companies that innovate fastest stand to capture disproportionate value. In our analysis, we focus on growth areas that capture these shifts and together shape the $2,060 billion How We Consume market size by 2035 (see Exhibit 7, next page): Health and Nutrition - Convenience - Shopper Experience 20 https://www.nasdaq.com/articles/cocoa-prices-surge-icco-cuts-global-cocoa-production-and-surplus-estimates 21 https://www.cnbc.com/2025/11/28-chart-how-much-coffee-prices-have-risen-since-1985.html 22 https://www.icco.org/statistics/ 23 https://www.whitehouse.gov/wp-content/uploads/2025/05/MAHA-Report-The-White-House.pdf # EXHIBIT 7 # Growth areas in How We Consume <table><tr><td>Growth areas</td><td>Health and Nutrition</td><td>Convenience</td><td>Shopper Experience</td></tr><tr><td>Definition</td><td>Products, services and technologies improving well-being through enhanced dietary intake</td><td>Solutions that simplify cooking, shopping, and delivery via digital platforms, smart devices, and rapid logistics</td><td>Technologies that personalize and innovate digital and in-store shopping</td></tr><tr><td>Sized sub-segments</td><td>Functional foods and beveragesSupplementsPersonalized nutrition and diagnostics</td><td>Food deliveryQuick commerceMeal kitsMajor smart kitchen appliances</td><td>Retail mediaAdvanced automated checkoutsAgentic food commerce</td></tr><tr><td>Growth drivers</td><td>Rising focus on preventative health and longevityGrowing prevalence of lifestyle-related health issuesAdvances in data, genomics, and wearable-enabled personalization</td><td>Demand for time-saving solutionsExpansion of tech-enabled ecosystemsUrbanization driving demand for fast and flexible delivery models</td><td>Rapid digitalization of retailStrong retailer and brand incentives to leverage first-party dataAdvances in AI and automation</td></tr><tr><td>Challenges</td><td>High development costsConsumer skepticism and inconsistent efficacy dataComplex regulations for health claims</td><td>High acquisition and labor costs affect profitabilityProduct quality and freshnessCompetition from traditional retail</td><td>High infrastructure and technology integration costsData privacy concernsUnclear ROI for emerging autonomous models</td></tr><tr><td>Market size in billion USD and CAGR</td><td colspan="3">800490610430202520302035</td></tr></table> Source: Strategy& analysis Consumers today expect food that is not only affordable and tasty, but also healthy, sustainable, and available whenever and however they want it – whether online, to-go, pre-cooked or in-store (see Exhibit 8). PwC's Voice of the Consumer 2025 study confirms this shift toward more fragmented, health-conscious and omnichannel shopping behaviors. In interviews, executives emphasized that this growing fragmentation raises complexity across assortments, supply chains, and go-to-market models, making personalization not just a growth lever but a core operational capability. # Health and Nutrition The rapidly increasing number of health-conscious consumers, who expect food and drink to actively support specific wellness and health goals $^{24}$ , is opening new horizons for food players. Across interviews, leaders highlighted that the health trend, after years of quiet momentum, is now gaining real traction and reshaping demand. We estimate that the three Health and Nutrition sub-segments in our analysis alone will grow to around $800 billion by 2035 – and the broader opportunity could be significantly larger. 24 The Planetary Health Diet, proposed by the EAT-Lancet Commission, outlines dietary patterns that support human health while staying within planetary boundaries, emphasizing whole foods, plant-forward diets, and reduced environmental impact: https://eatforum.org/eat-lancet # EXHIBIT 8 How We Consume – Relevant factors for food choices Fortified and functional foods and beverages are becoming a strategic focus in the industry, driven by rising consumer demand for products that offer added nutritional benefits – such as extra protein, fiber, or targeted health functionality – without compromising on taste or affordability. Retailers are increasingly using private-label brands as a key vehicle for these health propositions, allowing them to move faster, control price points, and scale functional offerings across mass-market categories. This momentum is accelerated by the rapid rise of GLP-1 medications. In the U.S., around $10\%$ of adults report having used GLP-1 drugs[25] with Ozempic's average index growth rate outpacing estimates for other major disruptors such as the Apple iPhone[26]. Recent evidence shows that GLP-1 adoption is already changing consumer behavior, including attitudes toward portion size, satiety, and food choices, with early impacts visible across categories such as snacks and indulgence products, signaling a broader shift in how consumers experience food.[27] While many companies remain cautious about predicting long-term category effects, current analysis suggests that the scale and speed of adoption could structurally shift demand toward protein-rich, functional, and nutrition-dense products.[28] Several interviewed companies anticipate additional opportunities in protein-enriched and functional foods, whereas others are reluctant to make major portfolio shifts until clearer patterns emerge. Many leaders also highlighted a rising consumer focus on longevity and healthy aging, which is further boosting interest in functional and health-oriented products beyond short-term diet trends. A major challenge for functional foods and beverages lies in their marketing, particularly regarding regulatory compliance and consumer confidence. 25 https://www.kff.org/health-costs/poll-1-in-8-adults-say-theyve-taken-a-glp-1-drug-including-4-in-10-of-those-with-diabetes-and-1-in-4-ofthose-with-heart-disease/ 26 https://www.pwc.com/us/en/services/consulting/business-model-reinvention/glp-1-trends-and-impact-on-business-models.html 27 https://hbr.org/2025/10/how-glp-1-medications-are-changing-consumer-behavior 28 https://www.pwc.com/us/en/industries/consumer-markets/library/glp-1-weight-loss.html Food is no longer just something you eat, but something you use to improve your wellbeing. Functional foods, from probiotics to precision-formulated drinks, are one of the fastest-growing spaces we see, driven by consumers who recognize the powerful role food plays in their health Rebecka Löhman Rydå, General Partner at Norrsken Evolve Meanwhile, diet supplements are catering to rising demand for proactive "well care", as consumers increasingly prioritize prevention and daily health management. This growing awareness is driving interest in personalized supplements that are tailored to individual wellness programs, as highlighted by the Strategy& 2025 Future of Health study.[29] Moreover, advances in wearable health trackers, AI analytics, and diagnostics are enabling personalized nutrition and early detection of conditions such as type 2 diabetes. This reflects a broader move toward data-driven, preventive health ecosystems that integrate real-time monitoring, behavior insights, and nutrition guidance into daily life.[30] Essentially, the growth of the personalized nutrition field depends on consumer participation, reduction of diagnostic costs, and further scientific progress. # Convenience Meanwhile, the rise of the Convenience growth area is driven by urbanization, smaller households, and time-pressed lifestyles, with digitization acting as a key accelerator toward on-demand food models – a shift reinforced by COVID-19 and showing no sign of reversal. 29 https://www strategy and. pwc.com/de/en/industries/pharma-life-sciences/future-of-health/2025/strategy-and-future-of-health-2025.pdf 30 https://www strategy and.pwc.com/de/en/industries/pharma-life-sciences/future-of-health/2025/strategyand-future-of-health-2025.pdf 66 When our customers go shopping, they want to have different options. We view it in terms of this broader trend of a digital, immersive experience. Customers still want to go to the store, but they also want to have online delivery and pick-up services and be able to move across all three channels in a very integrated way." Mary Ellen Adcock, Executive Vice President and Chief Merchant and Marketing Officer at The Kroger Co. Quick commerce is among the fastest-growing sub-segments of convenience retail. While profitability remains a challenge, driven by high fulfillment and labor costs, limited willingness to pay for delivery, and thin margins, consumer demand continues to rise, with Asia accounting for $57\%$ of the quick commerce