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It is September 13, 1833,
in the Northeastern Indian port city of Kolkata.
It is 90 degrees outside and the air is humid.
You're in a crowd anxiously waiting, unsure if you're about to
see a historical feat of human ingenuity or an elaborate prank.
Then slowly and steadily off the horizon, a brig named Tuscany approaches.
In it, 100 tons of ice, cut in blocks and stacked neatly against one another,
having just finished a four month voyage, all the way from Boston.
What you just witnessed was the journey along one of the first international
temperature-controlled supply chain, also known as the cold chain.
The man behind this cold chain was Frederic Tudor,
deservedly nicknamed The Ice King.
Tudor started this icy empire by harvesting natural ice in the dead of
New England winter, then delivering it first across the United States and
eventually to Great Britain and India.
Whilst this journey was long and its historical significance monumental,
Tudor's cold chain from a logistical perspective was extraordinarily simple.
For a long time, the only commodity he transported was ice and
ice kept itself cool as long as there was sufficient insulation.
So Tudor invested heavily in these ice houses along the ports and
his business took off.
Now in the two centuries that followed, the cold chain had come a long way.
Today, the cold chain is more complex and more global than ever before.
Just to give you a sense of its scale and complexity, nowadays for a piece of
imported fruit to get to you and me, it will roughly go through 20 steps.
Here's a chart just to show you what that's like.
In the last three years working as a food investor, I have seen this process
in play day in and day out, in lettuce fields, in sew plants, and in refrigerated
trucks delivering imported cheese to pizzerias all across New York City.
I marveled at this well oiled machine that connects growers,
manufacturers, distributors, retailers, and consumers.
The cold chain enables us to introduce diversity and abundance into our diet.
It removes seasonality and distances from food.
It gives us choices so that food is not just about survival, but
part of our identity.
That is, until this all stopped working.
Many of these images may look familiar to you.
Bagel shops without cream cheese.
Starbucks without Frappuccino.
KFC without chicken tenders.
For me, a broken cold chain meant spending hours on the phone with
our logistics providers, telling them how unacceptable it was for
them to leave frozen ready meals in a hot truck for 24 hours too long.
Our cold chain is susceptible to disruptions, and
we've had an awful lot of disruptions in the last two years.
Not only that, the cold chain is also fossil fueled and
incredibly energy-intensive.
According to the UN, the food cold chain accounts for
about 1.2 gigatons of co2 emissions.
That is about 1% of total global annual emissions.
So in between worrying about the revenue loss from customers
receiving spoiled food, and the costs associated with that
extra pack of dry ice I now need to budget for it in the deliveries.
I couldn't help but wonder, how can we make this better?
One solution came to mind, and it's almost too obvious and too logical.
Why not simplify the supply chain?
Do what the industry calls nearshoring.
Take out a few nodes here and there, shorten the distance traveled,
source locally, eat farm to fork.
It's simple, sustainable, and more resilient, right?
Not so fast.
To illustrate just how complicated the cold chain is and how hard it is to
disentangle even a tiny portion of it, let me take you on a journey of one commodity.
Walk into any Western European supermarket and
you will see these beautiful uniform fresh French green beans.
These beans were in the fields just 48 hours ago in the rural villages outside
Bobo-Dioulasso in Burkina Faso, among many other former European colonies in Africa.
These beans were handpicked by local manual labor when it's hot and
sunny outside, and then immediately chilled to about 40
degrees Fahrenheit to ensure high export quality.
They're then loaded onto refrigerated trucks to be packed at
a temperature-controlled facility.
Then, lastly, loaded onto a jet flying directly to Paris.
Now what is missing from this picture of seamless modern miracle is the fact
that many of these villages don't have paved roads or electricity.
These farmers rely on charcoal to chill the beans instead of refrigerators,
before sending the beans to an air conditioned facility to be processed.
Many of these farmers also have come to rely on this high value export crop
as their sole source of income.
And they import shelf stable food for their own consumption.
Now if we decide that we want to in source the beans,
these farmers would lose their livelihood and the local economy would collapse.
But perhaps most ironically,
those who grow the beans cannot even afford to eat them.
The lack of cold storage meant that most of these beans would rot
before the locals could get a chance to consume them.
You see, eating locally requires refrigeration,
and refrigeration is simply too expensive.
In fact, scientists estimate that as much as 40% of the fresh
food produced in Africa is lost due to inadequate cold chains annually.
Globally, the carbon footprint of food loss and
food waste is four times the carbon footprint of the cold chain itself.
So counter intuitively for us to solve for a less carbon-intensive
food ecosystem means adding cold chain capacity and adding it quickly.
And since I'm talking to about 200 of you who will be future business leaders,
I want to talk about what you can do.
As your companies rethink about your supply chain in the post-pandemic world,
it is imperative that you go beyond the cookie cutter diversification or
nearshoring strategies that your consultants keep pitching you about and
think about the whole ecosystem.
Resiliency comes from strengthening the entire supply chain,
and it begins with investing in the most fragile links,
like bringing roads, bringing electricity, and
bringing refrigeration to those villages in Burkina Faso.
Tudor understood that until every port had an ice house,
there was no cross Atlantic ice trade.
Similarly, there is no resilient global supply chain if farmers
don't have the infrastructure to store what they've produced.
This is also good for business.
Better cold storage at the point of harvest meant fresher,
higher quality produce for your company.
It decreases food loss and also makes for more predictable supplies.
This will save you money and is also more sustainable.
And finally, there's massive social benefits for the local community.
They'll obviously get access to better, safer, and more nutritious food.
But more importantly, the same set of cold storage infrastructure
will also provide access to lifesaving drugs and
vaccines like what we've seen in the last two years.
The pandemic gave us an opportunity to rethink and
reimagine what the future cold chain should look like.
Let's take a page from the Ice King's playbook and
start investing in the weakest link in this global system.
Only then will we be able to provide freshness to all,
resiliently, sustainably, and equitably.
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