Feeding the World Will Be More Difficult, Nestle’s Bulcke Says

Nestle SA (NESN) Chief Executive Officer Paul Bulcke said feeding a swelling world population will be made more difficult by slowing crop-yield growth and scarce resources.

Following are comments Bulcke made at the “Feeding the World” meeting organized by Economist Conferences in Geneva yesterday. Nestle’s products include KitKat chocolate bars and Nescafe instant coffee.

“In the next 40 years, we’re going to have to feed 2.3 billion additional people in the world, and they’ll be increasingly affluent. Meeting this future challenge of food is not going to be as easy as it was in the past. In the last 20 years, the growth per hectare has been much slower than the growth in population.”

Crop and food losses in developing countries are linked to harvesting, transportation and storage, while “in the developed world, it is lost in the kitchen, and that is a very different loss,” Bulcke said.

Water scarcity is “a serious problem,” with lakes drying up and some rivers not reaching seas, according to the Nestle CEO. “Already today there is serious overdraft,” Bulcke said. “It’s said we’re going to run out of water much faster than we’re going to run out of fuel.”

“The discussion on biofuels should take place as soon as possible. The amount of food going into the wrong biofuels is enormous and is a major source of stress” and price swings, according to the CEO. He said that while Nestle is “not against biofuels,” the focus should be on so-called second- and third- generation biofuels that use crop waste and non-food materials.

Nestle is working to improve crops’ disease resistance, yields and water efficiency and also providing improved plants to farmers as well as training them in “the self-interest of the company,” the CEO said.

“Coffee and cocoa are very important ingredients for us,” Bulcke said. “We give them to the farmers. We need good-quality ingredients, we give them that.”

The CEO said the company is also addressing the “major issue” of child labor in cocoa production, “a much bigger issue than Nestle alone,” he said.

“We’re investing quite heavily and increasingly in the developing world, where the growth is. Food is local, and as a food company you should be close to the consumer.”

To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net.

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net.