Final report Estimates of waste in the food and drink ... · Estimates of waste in the food ... in line with waste regulations. It has not ... and land-spreading are the two main

Final report

Estimates of waste in the food

and drink supply chain

This report contains estimates for the amount of waste in the UK supply chain of food and drink. Estimates for 2011 are presented for food and drink manufacturing, grocery retail and wholesale, including waste food and drink and waste packaging.

Project code: WRAP01 312 PAD102-308 Research date: October - December 2012 Date: October 2013

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Written by: Dr Peter Whitehead (WRAP), Dr Julian Parfitt (OH), Ms Katherine Bojczuk (OH) and Keith James (WRAP)

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Estimates of waste in the food and drink supply chain 1

Executive summary

The production of food and drink results in significant benefits to the UK economy (£80bn Gross Value Added (GVA), around 7% of the UK total) as well as providing many jobs. It also uses significant quantities of resources and its impacts include 170Mt of CO2e emissions (21% of UK‟s territorial emissions) and the consumption of around 70 billion m3 of water or roughly 70% of the UK‟s water footprint1. Households spent some £101bn on food and drink in the UK in 2011. Some of the food and drink that is produced by manufacturers is not sold directly to intended customers (grocery retailers and wholesalers) or consumers (households) but managed in other ways, which can result in waste. Waste has a legal definition, namely „any substance or object which the holder discards or intends or is required to discard‟ agreed by the European Union. By-products also have a legal basis under EU law. Figure 1 shows the various flows that are considered in this report which is focused on the grocery retail market.

1 The Water Footprint of a product is the volume of freshwater appropriated to produce the product, taking into account the volumes of water consumed and polluted in the different steps of the supply chain.


Figure 1: Grocery waste and non-waste material flows

In 2012 WRAP undertook work to provide robust estimates of these flows in the grocery supply chain. The work was undertaken by an internal project team within WRAP supported by Oakdene Hollins. We have excluded agriculture/fishing and households from the supply chain. Waste disposed to sewer is also excluded (though WRAP has published estimates from CC2 signatories2). All food and drink waste arising in manufacturing is attributed to the grocery retail market3. In total, some 10.7 million tonnes (Mt) of food, drink and packaging is managed through the routes shown in Figure 1. Not all of this material is legally classed as waste and not all is lost to human consumption (though the majority is). Some material is legally classified as by-product and may then be treated as a waste, in line with waste regulations. It has not proved possible to fully quantify all these flows in this exercise, though the majority have been. The principal material output is waste (Column 1, waste food and packaging, Figure 1), as legally defined, and the work undertaken provides estimates, for 2011, of total waste from

2 http://www.wrap.org.uk/sites/files/wrap/CC2_Interim_Report_AUG_2012.pdf

3Industrial classifications based on the dominant business activity at a site do not differentiate between grocery retail and foodservice markets. Similarly, waste audit data and Courtauld Commitment 2 returns do not split out waste arisings at a manufacturing site with respect to these different markets.

Grocery sector (retail and

manufacturing)

Food and packaging

waste

Disposal and other

management routes

Food redistributed

Charity

Secondary markets

Consumed by humans

Food used as an ingredient in animal feed

Consumed by animals

Food and drink classed as by-

products

Rendering

Pet food and non-food markets

Waste, food and packaging

Surplus food redistributed

Food to animal feed

By-products


the grocery retail grocery sector disaggregated into food, packaging and mixed waste streams. These data are further disaggregated into, for example, the management routes for this waste. All the food and drink within this material is lost to human consumption. We estimate that there are 6.5Mt of grocery waste4. This total comprises 1.6Mt from grocery retail and wholesale and 4.9Mt from manufacturing. Surplus food and drink that is redistributed (Column 2, surplus food redistributed, Figure 1) amounts to some 5,800t which goes to charities such as FareShare who use the surplus food to feed people. In addition, a minimum of 11,000t of food and drink is sold to organisations like „The Company Shop‟ who buy food for sale onto secondary markets5. Both these routes for managing food are termed „redistribution‟ because the food is still being consumed by humans, albeit probably involving an economic loss. Food used as an ingredient in animal feed (Column 3, food to animal feed in Figure 1) is more difficult to estimate. Some food material can also fall into Column 4, by-products, of Figure 1 because they are legally defined as by-products (for example, spent grain from distilleries). We have estimated that around 450,000t of food is used as an ingredient in animal feed and that further quantities of mostly unavoidable material like peelings and skins are also sent for animal feed together with material legally classed as animal by-products. Wholly within Column 4, by-products, of Figure 1 are by-products from manufacturing operations and animal by-products and co-products that arise from slaughtering cows, pigs, sheep, chickens and fish. A total of 2.2Mt of food is used as an ingredient in animal feed. About 1.7Mt is by-product and the remainder is food (Column 3 – food to animal feed, Figure 1). In addition, the carcase and other material from slaughtered animals are regarded as animal by-products (and co-products) under European legislation and primarily sent for rendering which in turn produces pet food and a range of non-food products. There are about 2.0Mt of such material in the UK6. Our analysis of grocery waste is shown in Figure 2 below. The diagram shows where the waste arises and how it is being managed.

4 Excludes all material that is disposed to sewer. Courtauld signatories reported some 0.2m/t of waste was disposed to sewer in 2010.This suggests there are significant additional quantities of waste disposed this way and not included in the above total.

5 We are using this term in this context to refer largely to wholesalers and street markets.

6 FABRA estimate that 2.25m/t of animal by-products are handled by the UK rendering industry. This includes material including fallen stock out of scope in this work. Animal by-products and co-products sent for rendering are classed as waste, but wastes sent to rendering are currently excluded from Waste controls under the revised Animal by Products Regulations. Readers should refer to the waste regulations and to guidance from the regulators, e.g. in England and Wales, the Environment Agency provides sector guidance.

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Figure 2: Total grocery waste

Note: total Manufacturing Waste includes 0.5Mt of „Other‟ waste that is not food or packaging The „waste hierarchy‟ which ranks waste management options according to what is best for the environment, is now transposed into UK law and sets out management approaches for dealing with grocery waste and all other waste. The main management types are: Prevention – includes measures taken before the material or product has become waste that will reduce the quantity of waste. Prevention also includes other uses of food, drink and packaging: „Redistribution‟; and food used in animal feed. Recycling – includes any recovery operation by which waste materials are reprocessed into products, materials or substances whether for the original or other purposes. Recovery – includes any operation the principal result of which is waste serving a useful purpose by replacing other materials which would otherwise have been used to fulfill a particular function. Figure 3 shows how grocery waste of 6.5Mt is managed against the waste hierarchy. It can be seen that recycling (which includes composting) and land-spreading are the two main methods of management. The current research shows that for food, anaerobic digestion is environmentally better than composting and other recovery options. Some 19,000t of food waste is being sent to AD (see Table 1 below) though it is unclear how much mixed waste


goes down this management route7. Figure 3 shows that at least 3.1Mt (48%) of waste is being managed in the least environmentally beneficial ways.8

Figure 3: Waste hierarchy

While this work provides a more comprehensive analysis of waste and other flows than has been available in the past, there is further work which could improve the estimates including:

Identifying and analysing waste arising from the agriculture sector;

Developing a category split of the data on food and packaging waste;

Estimating the amount of food waste that is unavoidable.

7 WRAP‟s Annual Survey of the Organics Recycling Industry is currently in preparation and will provide further data on quantities of food waste being processed by AD. Tonnage reported as recycled and other classifications may include material sent for AD, but we do not have the data to estimate this

8 This excludes Animal By- Product sent for rendering and treated as waste


Food Figure 4 shows overall food waste for the grocery sector and food that is redistributed, in other words all co/by-products have been excluded.

Figure 4: Food waste and surplus food redistribution9

Note: a very small quantity of food is redistributed by Wholesalers.

Grocery retailers and manufacturers segregate some food for waste and other management but there is also a significant quantity (0.8Mt) of mixed waste that has not been segregated and comprises both food and packaging10 (there is also 0.5Mt of „Other‟ waste that is neither food/drink nor packaging). Total food waste from the grocery sector, therefore, includes food waste that is segregated and an estimate of food that is part of mixed waste (that is, not segregated). Total food waste in 2011 is 4.3Mt. This includes 3.8Mt of segregated food waste and 0.5Mt of food included in the mixed, non-segregated waste stream (of which 0.4Mt is from grocery retail and 0.1Mt from manufacturing). Food waste in manufacturing amounts to 3.9Mt and in grocery retail (and wholesale) 0.4Mt. Table 1 shows the management routes for these waste streams. Recycling, which is a significant management route for manufacturers includes composting. Where food is disposed of as part of mixed waste it is not possible to identify the disposal route.

9 Where food products are not sold by a multiple retailer in the UK, there are other secondary markets, for example through markets, some convenience stores and through businsesses such as The Company Shop. People are still the end consumer through these secondary markets.

10 It is likely that non-food and packing waste is included in the mixed waste stream. Our assumption therefore may overstate the true amount of food waste arising at grocery retail.


Table 1: Food and drink waste in grocery retail and manufacturing

Management Grocery retailers3

Manufacturers Total (Mt)

Landfill - 45,000 0.04

Recycling1 - 1,300,000 1.3

Thermal - 400,000 0.4

AD2 19,000 - 0.02

Land spreading - 2,000,000 2.0

Unknown 401,500 181,000 0.6

Total m/t 0.44 3.9 4.3 1 Includes composting. A proportion of this waste may also be going to AD, but we do not have the

data to identify this. 2 A proportion of waste in the ‘Unknown’ management route may also be going to AD. There may also

be a component of ‘Recycling’ that should be reported as AD, but it was not specified as such from the data used in this study. 3 Food waste from wholesalers is estimated at 17,000t. The main management route is thermal

treatment. 4 This estimate maybe high depending on the composition of mixed waste.

Any differences between the data in this table, the further data tables in the report and the infographic are due to rounding.

Optimising Food Use and Food Redistribution A minimum of 11,000t of food is sold through organisations like „The Company Shop‟. A small quantity of food is redistributed to charities and consumed by people or sold through organisations who then sell it onto secondary markets thereby preventing the food and drink from becoming waste. We estimate some 5,800t (packaged or otherwise) of food was donated to charity for human consumption in 2011. Around 2,200t was donated by grocery retailers and some 2,700t by manufacturers. About 800t of the total is estimated as packaging. Animal Feed The amount of food used as an ingredient in animal feed is estimated at 2.2Mt. A large proportion of this food is legally classed as a by-product and is therefore not waste. The estimate of the amount of food used as an ingredient in animal feed is 0.45Mt. There will also be some unavoidable food material used in animal feed but we have been unable to estimate the magnitude. We have also been unable to estimate what proportion of this food could have been consumed by people. All of this food originates in manufacturing. Packaging Total packaging waste includes that which is segregated and an estimate of packaging waste that is part of mixed waste. Total packaging waste in 2011 is 1.6Mt. This includes 1.4Mt of packaging that is segregated and around 245,000t that is part of the mixed waste stream.


It is not possible to break down by management route the packaging waste that is included in the mixed waste stream. The table below shows how segregated packaging waste is managed.

Table 2: Packaging waste in grocery retail and manufacturing

Management Grocery retailer/wholesale

Manufacturers Total (Mt)

Landfill - 87,000 0.1

Recycling 980,000 300,000 1.3

Thermal 74,000 - 0.1

Total 1.0Mt 0.4Mt 1.4

It has not been possible to differentiate packaging waste by stage in the supply chain (tertiary/secondary/primary) or to quantify the types of packaging (primary, secondary, tertiary and material e.g. card, plastic) that are being recycled (the most significant management route). Grocery retail and manufacturing waste The analysis shows that the bulk of total grocery waste (6.5Mt) arises in manufacturing (75%) followed by grocery retail and wholesaling. Food waste from manufacturing (58%) is the single largest component of grocery waste. The second largest component is packaging waste arising at grocery retail (15%). The table below shows the main components of grocery retail and manufacturing waste streams.

Table 3: Main waste in grocery retail and manufacturing

Waste Stream Grocery retail

Manufacturing Total** (Mt) %

Food waste 21,000 3,800,000 3.8 58

Packaging waste* 981,000 354,000 1.3 20

Food in Mixed waste 406,000 120,000 0.5 7

Packaging in Mixed waste

87,000 124,000 0.2 3

Other waste - 492,000 0.5 7

Total (Mt) 1.5 4.9 6.3 *Excludes 0.1Mt from Wholesalers ** Totals have been rounded

Food that is being lost to human consumption includes material that is legally waste and material that is not classified as waste because it is used to feed animals. It could also include edible by-products and edible co-products under the animal by-products regulations11. To the 4.3Mt tonnes of food waste we add the 450,000t of food that is an ingredient in animal feed and 16,000t of edible co-products and offal from slaughtered animals that are not currently being marketed12. This provides an estimate of around 4.8Mt

11 There is no widely accepted definition of „food lost to human consumption‟. Food that is redistributed is not lost to human consumption.

12 See: Resource Maps for fresh meat across grocery retail and manufacturing supply chains WRAP (2011). We have assumed the current UK market for offal could be doubled.


of food that is being lost to human consumption from the grocery supply chain13. Some by-product from food processing is already being used as an ingredient in other food products. There may be more potential to do this but we have not looked in detail at the composition of this material and the potential that might exist. The composition of other waste is not known.

Country Splits It is possible to estimate food and packaging waste arising across the UK using data on the industrial structure of the respective nations to apportion the manufacturing total and population to apportion the grocery retail total. The table below shows the estimated country split.

Table 4: Breakdown of waste by nation

Country Total waste (Mt)

Food waste (Mt)

Packaging waste (Mt)

England 5.1 3.3 1.3

Scotland 0.7 0.5 0.1

Wales 0.3 0.3 0.1

NI 0.3 0.2 0.1 NB Excludes Wholesale, which is not possible to split by Country

Economic Impact We estimate that food and packaging waste is valued at £6.9bn. This includes the costs of producing food and packaging, disposal costs and lost profit. This estimate is higher than previously published largely because of increased ingredient, energy and other costs associated with food manufacturing. This money is being wasted and value is being lost to the economy. The total represents around 7% of consumer expenditure on food and drink and 8.6% of the sectors GVA. These percentages are likely to be a higher proportion than many grocery retailer and manufacturer profit margins (in comparison with sales). Whilst waste cannot be reduced to zero, there are significant opportunities to reduce it and achieve the associated economic benefits of doing so. Greenhouse Gas Emissions (GHGs) Across WRAP‟s work, the GHG impact of agriculture, manufacturing, grocery retail and distribution is allocated to the food which is purchased by households. This means that no impacts are allocated to the creation of waste produced at each of these stages. For consistency, it is therefore appropriate only to attribute disposal emissions to the food waste when considering the footprint of supply chain food waste. Waste emissions from manufacture to grocery retail are estimated at 250,000t CO2e. However, there is also an opportunity cost associated with the wasted food. The opportunity cost is the value of the best alternative forgone. Depending on whether the food was suitable for animal feed or human consumption, the opportunity cost is between 1 and 13 million tonnes CO2e respectively.

13 All by-products have been excluded from this estimate which probably understate the true amount.


Comparisons Levels of food and drink waste in the grocery sector have fallen over the long term14. Data from signatories to the Courtauld Commitment for 2011 and reported by WRAP in 2012 indicate that after a slow start, there has been a considerable reduction in supply chain waste: 8.8% less, well ahead of the three-year target of 5%. Supply chain waste reduction was added to the voluntary agreement in Phase 2 which launched in 2010 and has been an area of focus for WRAP and signatories. The final outcome will be published in 2013. The data presented above for 2011 cannot be compared with earlier estimates for 200815 because of differences in scope and definitions, methodology and the relative accuracy of data sources. Any underlying trends in the data between the two years are masked by the different approaches. More recent and different sources of data have been used in this 2012 study in order to maximise the accuracy of the estimated numbers.

14 See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/183302/foodpocketbook-2012edition-09apr2013.pdf

15 See: Waste arisings in the supply of food and drink to UK households, WRAP (2010)


Contents

1.0 Project scope and definitions ..................................................................... 14 1.1 Purpose ................................................................................................... 14 1.2 Grocer retail supply chain ......................................................................... 14 1.3 Waste streams ......................................................................................... 15 1.4 Secondary markets ................................................................................... 17 1.5 Rendering ............................................................................................... 18 1.6 Summary ................................................................................................ 19

2.0 Data sources ............................................................................................... 20 2.1 Courtauld Commitment (CC2) data ............................................................ 20 2.2 Commercial and Industrial (C&I) waste data............................................... 20 2.3 Integrated Pollution Prevention and Control (IPPC) data .............................. 21 2.4 Food and Drink Federation (FDF) data ....................................................... 21 2.5 IGD......................................................................................................... 21 2.6 Other data sources ................................................................................... 21

3.0 Food and drink manufacturing: Method ..................................................... 23 3.1 Food/drink waste estimates (sites with 100+ employees) ............................ 23 3.2 SME waste estimates (fewer than 100 employees) ...................................... 26 3.3 Waste estimates summary ........................................................................ 26 3.4 Waste composition ................................................................................... 26 3.5 Waste fate ............................................................................................... 27 3.6 Breakdown by country .............................................................................. 28

4.0 Wholesale: Method ..................................................................................... 29 4.1 Wholesalers survey .................................................................................. 29 4.2 Market size .............................................................................................. 29 4.3 Scope...................................................................................................... 30 4.4 Methodology ............................................................................................ 30 4.5 Wholesalers data analysis ......................................................................... 31

5.0 Grocery Retail: Method ............................................................................... 32 5.1 Grocery retail waste fate ........................................................................... 32 5.2 Grocery retail split by country.................................................................... 32

6.0 Animal Feed: Method .................................................................................. 34 6.1 Scope...................................................................................................... 34 6.2 Data analysis ........................................................................................... 34 6.3 Methodology ............................................................................................ 35 6.4 Analysis of existing data ........................................................................... 35 6.5 Sector categorisation ................................................................................ 35 6.6 Obtaining final estimates .......................................................................... 36 6.7 FDF+CC2 animal feed ............................................................................... 37 6.8 Animal feed survey, structure of the animal feed market ............................. 37

6.8.1 FeFac (2012) Feed use of former foodstuffs. .................................... 38 6.8.2 Defra feedstuffs dataset ................................................................. 38 6.8.3 Food and Drinks Resource Map ....................................................... 39

6.9 Avoidable/non-avoidable waste ................................................................. 40 7.0 Food charities: Method ............................................................................... 41

7.1 Data ....................................................................................................... 41 7.2 Methodology ............................................................................................ 41 7.3 Survey summary ...................................................................................... 41

8.0 Economic and environmental impact .......................................................... 43 8.1 Value of a tonne of waste ......................................................................... 43 8.2 Economic impact ...................................................................................... 44 8.3 Environmental impact ............................................................................... 44


9.0 Changes between 2008-2011 ..................................................................... 47 9.1 Grocery Retail .......................................................................................... 48 9.1.2 Composition of waste ................................................................................. 48 9.1.3 Fate of waste ............................................................................................ 48 9.2 Manufacturing.......................................................................................... 49 9.2.1 Composition of waste ................................................................................. 49 9.2.2 Fate of waste ............................................................................................ 50 9.3 Animal Feed ............................................................................................ 50

Appendix 1: Surveys ............................................................................................. 51 Appendix 2: Waste Classification ......................................................................... 54

Tables Table 1: Food and drink waste in grocery retail and manufacturing ................................... 7 Table 2: Packaging waste in grocery retail and manufacturing .......................................... 8 Table 3: Main waste in grocery retail and manufacturing .................................................. 8 Table 4: Breakdown of waste by nation .......................................................................... 9 Table 5: Grocery retail supply chain, components in scope ............................................. 15 Table 6: Approach to quantification: grocery retail and wholesale ................................... 16 Table 7: Approach to quantification: Manufacturing ....................................................... 17 Table 8: Data source information ................................................................................. 23 Table 9: Division and Group SIC code glossary for manufacturing of food and drink products .................................................................................................................................. 23 Table 10: Waste estimates for the UK food & drink manufacturing sector ........................ 26 Table 11: Waste composition summary (2011) .............................................................. 27 Table 12: Country breakdown of sites by SIC ................................................................ 28 Table 13: Data sources information .............................................................................. 29 Table 14: Wholesale sectors and key players................................................................. 30 Table 15: Wholesale food and packaging waste, UK (based on Defra 2009) ..................... 31 Table 16: Data sources information .............................................................................. 32 Table 17: Sectors‟ coverage of sites sending product to animal feed, FDF 2008 dataset .... 36 Table 18: Size bands for grossing up data ..................................................................... 37 Table 19: FeFac Former foodstuffs processing into feed (2012) ...................................... 38 Table 20: Animal feed summary ................................................................................... 40 Table 21: Animal feed, potential waste/non-waste estimates .......................................... 41 Table 22: Data collected from individual charities .......................................................... 42 Table 23: Charity data (food and packaging) split by source ........................................... 42 Table 24: Estimates charity food and packaging, split by source ..................................... 42 Table 25: Value of food and packaging waste ............................................................... 44 Table 26: Greenhouse gas emissions ............................................................................ 45 Table 27: Opportunity costs ......................................................................................... 46 Table 28: Differences between 2008 and 2011 (nearest 1,000t) ..................................... 47

Figures

Figure 1: Grocery waste and non-waste material flows .................................................... 2 Figure 2: Total grocery waste ........................................................................................ 4 Figure 3: Waste hierarchy ............................................................................................. 5 Figure 4: Food waste and surplus food redistribution ....................................................... 6 Figure 5: Structure of the rendering sector ................................................................... 18 Figure 6: What do we want to know? ........................................................................... 19 Figure 7: UK Split of IDBR local business sites (with 100+ employees) by data source ...... 25


Figure 8: Origin of raw waste tonnages used for waste estimate, % weight ..................... 25 Figure 9: IGD retail wholesale market data ................................................................... 30 Figure 10: Structure of animal feed market ................................................................... 37


1.0 Project scope and definitions 1.1 Purpose This report provides more robust and up-to-date estimates of food and drink waste and other flows from the grocery retail supply chain for 2011. In 2010 WRAP published a report, „Waste arisings in the supply of food and drink to UK households‟. The report provides a comprehensive analysis of food and packaging waste in the grocery retail supply chain by bringing together data from several studies on food waste conducted across the UK with the results from a survey of the industry to provide estimates of grocery retail supply chain waste for 2008. During 2012 WRAP conducted a review of the grocery retail supply chain data that was led by an internal team supported by Oakdene Hollins. The reasons for this review include:

Elapsed time, WRAP wanted more up to date estimates as the current data relate to

2008,since when the economy has been in recession and there have been significant

changes in the grocery retail supply chain including, for example, an increasing proportion

of products sold on promotion, the growth in convenience grocery retailing and cost

pressures from commodity prices and elsewhere;

Developing a better understanding of waste at grocery retail, wholesale and

manufacturing and other disposal flows including on the fate of waste and a split of waste

across the UK;

New data sources of data have become available including, for example, information

supplied to WRAP (in confidence) by Courtauld signatories and a further sample of

commercial and industrial waste undertaken by Defra as well as new data from regulated

sites held by the Environment Agency; and

Measurement and data collection on waste has improved and there is now significantly

more data certainty.

1.2 Grocer retail supply chain The grocery retail supply chain generally covers those products that are purchased for consumption in the home. However, certain products consumed in the home can be purchased from foodservice outlets and not all products bought from recognised grocery retailers will be consumed in the home. The supply chain for grocery retailers is generally regarded as including farmers, processors and manufacturers (organisations), the information involved in moving products from suppliers to customers and the raw materials that are transformed into finished products. At least two different markets can be identified for the supply of food (groceries) to final consumers:

grocery retail market for „one-stop‟ shopping; and

grocery retail market for „secondary‟ shopping‟.

The Competition Commission defines 'one-stop shopping' as 'the shop for the bulk of a household's weekly grocery needs, carried out in a single trip and under one roof'. This is distinguished by the Competition Commission from other forms of shopping, characterised as 'secondary shopping', which typically involve the greater use of other types of grocery stores, a different product mix and a lower average basket spend. It is difficult to develop an all en-encompassing definition of the grocery retail supply chain, so rather than do this, the table below summarises key components of the grocery retail


supply chain in scope of this review. There will inevitably be some „boundary cases‟ not included. While we have kept the scope broad, it has not proved possible to obtain comprehensive data for all the sectors identified.

Table 5: Grocery retail supply chain, components in scope

Grocery retail Comments

Grocery multiple retailers Traditional grocery includes more than food e.g. household goods. A wide range of stores from hypermarkets to convenience.

Symbol groups and Independent grocery retailers

Mostly conveniences stores. Some independents will have a small food offer. Includes „corner shops‟, greengrocers, fishmongers and butchers.

Other grocery retailers: potentially wide ranging including drinks warehouses, farm shops, on-line providers, box schemes and markets

A small proportion of food (and drink) sales.

Wholesale

Major food wholesale companies Includes distributed wholesalers as well as cash and carry (excludes all foodservice operations).

Wholesale markets Minor players but localised importance.

Depots

All distribution centres and warehouses including consolidation operations

Includes both grocery retailer and manufacturer owned. Includes the transport operations which may be third party.

Manufacturing

All branded and own brand manufacturers Many are likely to supply multiple customers including foodservice.

All processing and packing operations Often separate operations to manufacturing.

All food packaging providers Only operations concerned with supply to grocery retail/ wholesale customers.

Notes: This definition is broadly equivalent to that adopted under the Courtauld Commitment in that it: Covers the UK only Includes all operations that are involved with producing goods for export Excludes all operations outside the UK involved with producing goods for import to the UK

Includes manufacturing operations that supply foodservice customers Excludes all primary operations including agriculture and fishing (and aqua-culture) Excludes all home grown products Excludes all canteens

1.3 Waste streams Waste is defined by EU law (Waste Framework Directive)16 as:

“any substance or object which the holder discards or intends or is required to discard”.

Whether a substance or object is being discarded has to be decided on a case by case basis, and taking account of all circumstances, to ensure the aims of the Waste Framework

16 See: https://www.gov.uk/waste-legislation-and-regulations


Directive are not undermined. In other words each case has to be assessed on its own merits. A way of defining food waste, specifically, is whether material represents a loss to human consumption. This has been defined by the United Nations‟ Food and Agriculture Organisation (FAO)17 as:

“Wholesome edible material intended for human consumption, arising at any point in the food supply chain that is instead discarded, lost, degraded or consumed by pests.”

To this could be added edible material intentionally fed to animals. Either way, this requires separating out material that is – at some point prior to disposal – edible (and wholesome) from inedible material associated with food such as citrus peel and chicken bones (unavoidable waste, to use current household food waste terminology). As such, the FAO definition is somewhat broader than the one adopted by the Waste Framework Directive. Further work on defining food waste is being undertaken as part of the FUSIONS project18. To assess the level of waste, separate data are required for several different streams identified below. The common measure for all waste (and other streams) is tonnes. However, it should be acknowledged (in line with the FAO definition above) that loss in quality and nutritional value in relation to food cannot be directly captured by a weight-based metric.

Table 6: Approach to quantification: grocery retail and wholesale

Grocery retail/wholesale Comment

All food that cannot be sold (and therefore is to be discarded). Separate identification for:

food only material;

food and its packaging;

food packaging only; and

mixed waste including

food/packaging.

This could arise for many reasons e.g. damage, past display until date. Does not include stolen food (shrinkage), food marked down for sale, food sold to The Company Shop (or similar), food used in staff canteens and staff sales. The data will identify different management options including the amount sent for animal feed.

All food (and packaging) donated to a charity that intends to use the material for human consumption.

All donations/ food redistribution regardless of whether the food is used in the UK or abroad. All charities included regardless of whether a membership fee has to be paid.

All meat/fish material that is sent to a rendering operation in the UK.

Category 1, 2 and 3 material under the Animal By-products Regulations (ABPR).

All distribution/consolidation centre food and packaging waste.

Includes all primary/secondary packaging.

Notes: Excludes any food/packaging that is returned to suppliers e.g. because of damage, incorrect labelling,

quality defects or other reasons (some of which has the potential for re-use).

Includes all food and packaging waste arising between grocery retail depots and stores

17 See: http://www.fao.org/docrep/014/mb060e/mb060e00.pdf

18 See: http://www.eu-fusions.org/news-and-events


Table 7: Approach to quantification: Manufacturing

Manufacturing/Processing Comment

All final food products that cannot be sold to grocery retail/wholesale or foodservice customers (and therefore are to be discarded). Separate identification for:

food only material;

food and its packaging;

food packaging only; and

mixed waste including

food/packaging.

This could arise for many reasons e.g. process inefficiency, damage, past display until date. Does not include stolen food (shrinkage) food sold to The Company Shop (or similar), food used in canteens and staff sales. The data will identify different management options including the amount sent for animal feed/land-spreading as well as incineration/AD/composting/landfill.

All food (and packaging) donated to a charity that intends to use the material for human consumption.

All donations/ food redistribution regardless of whether the food is used in the UK or abroad. All charities included regardless of whether a membership fee has to be paid.

All meat/fish material that is sent to a rendering operation in the UK.

Category 1, 2 and 3 material under the Animal By-products Regulations (ABPR).

Foods that are sent to animal feed. Includes all material sent for animal feed regardless of whether it is formally classed as a waste but excludes residues that are used to make different products sold for human consumption

All food and packaging waste arising at manufacturers‟ distribution/ consolidation centres.

Includes all primary, secondary and tertiary packaging

Notes: Includes all food and packaging returned by grocery retail customers that cannot be sold into the grocery

retail/wholesale of other markets and has therefore to be discarded Includes waste arising from production intended for customers in foodservice Excludes all food that is sold in all secondary markets Includes all transport related packaging including that arising at any port operation Excludes all processing/packing operations that take place as part of agriculture Includes wastes where they can only be identified as „other‟

1.4 Secondary markets Food that is being grown or supplied to grocery retail customers may not be acceptable for a variety of reasons. These reasons could include: failure to meet the grocery retail specification, quality defects on delivery, labelling issues and damage. Some production by manufacturers maybe done for test purposes, for example because a new product formulation is being developed or for trade sample purposes which results in them being „surplus‟ to requirements. Where possible the supply base will re-direct these products to secondary markets. This is likely to result in a value loss but not a waste (or loss to human consumption). Possible secondary markets include:

other grocery retail customers different to the one for which the product was intended,

for example discounters;

the wholesale markets from which products might go into grocery retail or foodservice;

some products could go for processing to make new products;


export markets; and

food brokering companies, for example, „The Company Shop‟.

The list of secondary markets is not exhaustive. It is not known how much food is distributed through any of these secondary routes, although „The Company Shop‟ handled 11,000 tonnes of product in 2011, estimated to increase to 25,000 tonnes in 201219. Other brokering companies include Approved Food and Food Bargains – both on-line - and Tiger Foods. Product handled through these channels is largely not wasted or lost to human consumption, it can be considered as a form of redistribution. 1.5 Rendering Animal by-products are not intended for human consumption (although some material that is currently being rendered could be consumed by humans) and must be disposed of in accordance with animal by-products legislation. Typically this will be through subjection to heat treatment. Rendering (the major treatment route) uses the residual material produced when animals are slaughtered, cut and prepared, (including bone, fat and feathers) to produce purified fat and protein products. This residual material is cooked at high temperatures to remove moisture, kill bacteria and separate out the fat and protein. Rendering produces meat and bone meal and fats which are used for fuel, pet food, oleochemicals, fertilisers and cement in varying proportions. The rendering industry produces small amounts of material (largely ash), which in the past had been disposed to landfill; this practice has now been phased out and the ash is used in cement manufacture. The Foodchain & Biomass Renewables Association (FABRA) estimates that about 2.25 million tonnes of material are rendered each year to produce around 500,000 tonnes of protein meal and around 300,000 tonnes of rendered fat.

Figure 5: Structure of the rendering sector

19 http://www.companyshop.ltd.uk/company-shop/company-overview.aspx


Rendering plants are located in England, Scotland and Northern Ireland, and can now only accommodate waste in Categories 1 and 3 (all Category 2 waste is therefore escalated to the higher category and is treated as if it were Category 1)20. In Great Britain, two red meat companies and one poultry company have their own rendering facility. 1.6 Summary This research involves quantification of a number of waste materials from the food and drink supply chain. In addition, some non-waste material management routes are also quantified to help understand the context in which material is supplied and wasted. Figure 6 summarises the key requirements for this research.

Figure 6: What do we want to know?

20 See: http://www.food.gov.uk/business-industry/guidancenotes/meatregsguid/coproductbyproductguide


2.0 Data sources Waste levels are not reported routinely through national or company statistics. There is, therefore, no single source of data on waste available. In the past WRAP has obtained estimates of waste from company surveys some of which were conducted by the Environment Agency. Reporting under Phase 2 of the Courtauld Commitment (which introduced a grocery retail and manufacturing supply chain waste prevention target) provides up to date and accurate data on waste that was previously not available. However, Courtauld returns are confidential to WRAP, not all sectors of food and drink are well represented and the agreement only covers a proportion of the industry. For these reasons multiple data sources have been used in this review in order to provide the most robust estimates possible and to secure high levels of coverage across the sectors of the industry. 2.1 Courtauld Commitment (CC2) data The Courtauld Commitment is a voluntary agreement aimed at improving resource efficiency and reducing the carbon and wider environmental impact of the grocery sector. Phase 3 was announced in May 2013 and runs until December 201521. Data for this study are taken from reporting by signatories to the second phase of agreement in 2011. As the signatories to the Commitment are more likely to be „early adopters‟ of environmental policies, it is likely to be biased towards those with more effective waste reduction and landfill diversion strategies (for instance low landfill quantities and higher recycling rates). It is also biased towards the very largest companies, and the CC2 data is not split out by site but reported at an enterprise level. It therefore cannot be easily used to provide waste estimates that are differentiated by sub-sector (within manufacturing), product and waste type (for example, food, packaging or mixed). The Courtauld data refers to the grocery supply chain, comprising food, drink and personal care items. Hence the supply chain waste data submitted to WRAP by Courtauld signatories, as requested, will include household & personal care and packaging from non-grocery sales; this needs to be taken into account when using CC2 data. CC2 data are confidential to WRAP and the individual returns were not made available to the authors of this report, only summary information. 2.2 Commercial and Industrial (C&I) waste data The Department for Environment, Food and Rural Affairs (Defra) commissioned a study to obtain data from businesses in England on Commercial and Industrial (C&I) waste arisings

and management methods in calendar year 200922. The survey contains data from 40,000 waste streams arising from around 6,000 premises. The survey covered 429 food and drink processing and manufacturing sites (from 7,600 sites in England) and over 3,000 waste streams. These have been summarised in an unpublished report prepared for WRAP which provided a compositional analysis of this waste (without grossed up results). The data from the 2009 survey excludes the northwest region, which was subject to a separate survey that was not fully compatible with the 2009 fieldwork. There is no comparable survey in Scotland and Wales or Northern Ireland for the same date. Previous surveys exist but also give rise to comparability problems.

21 See: http://www.wrap.org.uk/content/information-sheet-courtauld-commitment

22 See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/190220/ci-project-report.pdf


2.3 Integrated Pollution Prevention and Control (IPPC) data Food and drink companies need an environmental permit to operate if they carry out certain activities above set numerical thresholds23. Regulated businesses are required to report on levels of permitted waste. These data are likely to be biased towards larger manufacturing sites and those sites subject to Animal By-Products Regulations (slaughterhouses), but 375 food and drink manufacturing sites covered by IPPC represents over 35% of the total sites. The waste differentiation is detailed; however, its usefulness is restricted in that it is not specific about whether it is food, packaging or mixed (according to the European Waste Catalogue). It contains no information on by-product or surplus. 2.4 Food and Drink Federation (FDF) data The FDF has undertaken two waste surveys of its members24 in 2008 and 2010 (we understand a third is being planned in 2013). It covers a broad range of product types, sub-sectors and waste types and in this respect is useful. However, it is weakened slightly by different interpretations of various categories, depending on how sites classify „by-product‟, „surplus‟ and different types of waste. It lacks good representation of the drinks sector, as it generally only includes soft drinks manufacturers. 2.5 IGD Confidential information is provided as part of the ECR (UK) Work Group on Product and Packaging Waste. The data do not record baseline changes, only „initiatives‟, and there is no published breakdown. While a potential data source it was not used in this work. 2.6 Other data sources The Inter Departmental Business Register (IDBR) is a comprehensive list of all UK businesses25. The most current data has been obtained from the ONS (March 2012). IDBR is regarded as the best source of current data on the number and types of businesses operating in the UK. Data on the number of businesses, split into employee size bands, were obtained for both local business units and in terms of the number of enterprises. So a firm operating five different manufacturing sites across the UK would produce a count of 1 at enterprise level and a count of 5 at the local business unit level. Defra‟s feedstuffs dataset (The GB retail production of animal feedstuffs dataset 2011/1226) was used for obtaining tonnages of product being sent to animal feed. FeFac‟s27 report (2012) Animal feed use of former foodstuffs28 has also been used as a data source to help identify the tonnages of former foodstuffs29 that are being sent to animal feed. This includes bread, broken biscuits, misshaped pralines, dough trimmings, over-flavoured crisps, incorrectly packaged products and seasonal products.

23 See: http://www.environment-agency.gov.uk/business/sectors/138202.aspx

24 See: http://www.fdf.org.uk/waste.aspx

25 See: http://www.ons.gov.uk/ons/about-ons/who-we-are/services/unpublished-data/business-data/idbr/index.htm

26 Available at: http://www.defra.gov.uk/statistics/foodfarm/food/animalfeed/

27 FeFac is the EU Trade Association of Animal Feed Manufacturers

28 Available at: http://ec.europa.eu/dgs/health_consumer/dgs_consultations/docs/ag/summary_ahac_05102012_2_fefac_en.pdf

29 Defined as; “foodstuffs, other than catering reflux, which were manufactured for human consumption in full compliance with

the EU food law but which are no longer intended for human consumption for practical or logistical reasons or due to problems

of manufacturing or packaging defects or other defects and which do not present any health risks when used as feed.” Note,

excludes drink

http://www.defra.gov.uk/statistics/foodfarm/food/animalfeed/


Kantar Market Statistics (2012). This was used as the basis for calculating the CC2 grocery retail market share by volume of sales.


3.0 Food and drink manufacturing: Method This section outlines the method used for estimating waste and other flows in food and drink manufacturing. The available data sources are shown in Table 8.

Table 8: Data source information

Source Year Reference

FDF 2008 Used for some sites in grossing up, Section 3.1

CC2 2011 Added on in final stage of grossing up process, Section 3.1

IPPC 2011 Used for majority of sites in grossing up, Section 3.1

Defra 2009 Used to represent SMEs, details in Section 3.2

IDBR 2012 Used as reference for number of sites, Section 3.1 and 3.2

Manufacturers often serve multiple markets, such as grocery retail and foodservice. However, industry classifications based on the dominant business activity at a site do not differentiate between grocery retail and foodservice markets. The analysis has not therefore split the data in this way because there is no reliable means of determining this split from existing data sources. This split was not performed for the previous study which provided estimates for 2008 for the same reason. We used the SIC code structure to underpin the analysis.

Table 9: Division and Group SIC code glossary for manufacturing of food and drink products30

3 digit SIC Code Description

10.1 Meat

10.2 Seafood

10.3 Fruit & veg

10.4 Oils & fats

10.5 Dairy

10.6 Grain

10.7 Bakeries, bread

10.8 Sugar/chocolate/tea/coffee & other

10.9 Animal & pet food

11.0 Drinks

3.1 Food/drink waste estimates (sites with 100+ employees) Each of the three datasets available - IPPC, CC2 and FDF – has its own specific strengths and weaknesses. For example, CC2 on its own cannot be used as a basis for grossing up, as it is biased towards big businesses and certain sectors. To produce a waste estimate that was as robust as possible these three datasets were combined (using postcodes as a unique identifier of IPPC and FDF sites31) to minimise the effects of each dataset bias. Duplicates were discarded to avoid double counting, with CC2 and IPPC data given first and second preference respectively in such instances, because they are more recent than FDF data

30 See: http://www.siccodesupport.co.uk/

31 In a few instances different sites shared postcodes; these were identified and kept by cross checking with company name


(Table 8). The result was a sample of business sites that were then scaled to produce the overall estimate for manufacturing. As the FDF, CC2 and IPPC data mainly cover larger businesses within the food/drink sector, this component was covered separately using Defra 2009 (Section 3.2). In summary, the process of combining data sets and scaling was carried out as follows. At the start, all sites in the FDF and IPPC datasets were assigned a code from the UK Standard Industrial Classification of Economic Activities (SIC 2007). Where possible, sites were given a 4/5 digit SIC code (Division/Group/Class/Sub-Class) relating to their specific area of business. These were then aggregated into 3 digit (Division/Group) codes. This simplification allowed for the relatively small sample size (maximising the number of sites in each category), and also reduced the possibility of error for sites where the exact classification was difficult to determine. The CC2 totals were for enterprises (each signatory) rather than sites; however, where possible, they were also assigned an SIC code. This process resulted in a combined dataset of 315 separate data points, broken down into 312 local sites and 3 CC2 figures - one group for Sector 105, one group for Sector 110, and one general group that could not be assigned to a specific sector. The local sites were then categorised into size bands by number of employees: 0-49, 50-99, 100-249 and 250+. As there was no direct information on this within FDF, CC2 or IPPC data, size band boundaries based on the Defra 2009 C&I survey and its findings on waste arisings were created and used to classify each site. As it is not possible to gross up using IDBR data accurately without the size bands worked out, the relationship between „mean waste per site‟ and size bands (number of employees) was an essential part of the process. It is likely that the main changes since 2009 will relate more to the waste management routes used rather than the total waste arisings. Whilst there may also be some waste reduction achieved over the same time period, this report does not identify trend and changes in this way. Only the total arisings statistic is relevant to this grossing up issue. Sites in the two smallest categories were discarded (these bands were estimated separately in Section 3.2), leaving 234 sites. The resulting data points, which were classified by SIC sector and size, were then grossed up. The IDBR was used for grossing–up as it contains numbers of sites by size band, but before scaling, the IDBR totals had to be adjusted to account for the sites covered by CC2 data. The companies involved were researched and, where possible, the number of sites operated in the UK was deducted from the total for a specific sector. For companies where the number of sites was not clear, the average across CC2 was used. Sites that could not be assigned to a specific sector were averaged across all sectors and deducted accordingly. The resulting IDBR totals were used as targets for grossing up, following the method used for Defra 2009, which estimated total waste arisings in a stratum (a sub-population of businesses within a particular SIC coding and size band) by multiplying the IDBR number of local business units within the relevant size band and SIC by the relevant mean business waste arising per site obtained from all the samples collected. Through this method the waste tonnages were grossed up to give an approximate total for each sector. Because individual CC2 records are confidential, totals for specific sectors were then added on top, and then the remaining CC2 total (that was not sector specific) was added on to the overall figure. This resulted in an estimate for the waste produced by size bands 3 and 4 (100 or more employees) in the food manufacturing sector.


The final estimate used data from approximately 448 local sites compared to the IDBR total of 845 local sites with over 100 employees in the UK. Therefore the estimates directly used approximately 53% of all local sites within the two largest size bands, split between the three datasets as illustrated in Figure 7. The remaining 47% are extrapolated from the averages of the sample.

Figure 7: UK Split of IDBR local business sites (with 100+ employees) by data source

Figure 7 shows the proportion of the data from each source used in the waste estimate by raw tonnage (prior to any grossing up). As shown, 96% came from CC2 and IPPC, with a small amount from the FDF dataset. Because the CC2 data were not broken down by sector, they could not be included in the multiplying-up process and were added on at the end. Therefore in the final figure of total waste for size bands 3 and 4 the share of CC2 data is reduced to 40%. Of the 397 sites that are not accounted for, an estimated 160 are operated by CC2 signatories. This indicates that, with a full dataset for all Courtauld signatories, the overall proportion of the larger manufacturing sites not accounted for will be substantially reduced.

Figure 8: Origin of raw waste tonnages used for waste estimate, % weight


3.2 SME waste estimates (fewer than 100 employees) As the FDF, IPPC and CC2 data mainly cover larger businesses rather than SMEs (those with fewer than 100 employees per local business unit), a different approach was required to estimate waste arisings associated with SMEs within the food and drink manufacturing sector. It was agreed that a new survey of SMEs in food and drink manufacturing would not be necessary or a realistic proposition, for the following reasons:

Although SMEs are 90% of sites, they are likely to account for a small percentage of total

waste.

It is difficult to get meaningful data from a telephone survey and it was too expensive to

do site audits for this review.

Defra 2009 included a reasonable number of relevant SMEs with 5 to 99 employees.

In summary:

Defra 2009 C&I survey: 178 SMEs included in the sample;

separate estimates were made for size bands 1 (5-9), 2 (10-19), 3 (20-49), and 4 (50-99)

employees;

Defra 2009 C&I survey provides good representation across sectors, but with a bias

toward 20-99;

Waste arising from sites with 1-4 employees were estimated by scaling down the waste

arising from sites in the 5-9 employees category (these ratios were developed for the

Defra 2009 report);

The data from sites in the Defra 2009 survey were scaled up to all sizes using the IDBR.

3.3 Waste estimates summary The overall waste estimate for the food & drink manufacturing sector is 4.9 million tonnes per year. Approximately 86% of this total can be attributed to sites with more than 100 employees.

Table 10: Waste estimates for the UK food & drink manufacturing sector

Size Total waste (tonnes per year)

SMEs: <100 employees/site (re-analysis Defra 2009)

187,063

Larger sites: ≥100 employees/site (CC2, IPPC, FDF)

4,732,326

Overall waste 4,919,389

3.4 Waste composition For waste composition, two datasets have good compositional information. The FDF dataset was already broken down into packaging, mixed and food waste, and so could easily be utilised here. However, its age (2008/9) limited its usability, due to the changes that have occurred in the waste stream since then (for example, through light-weighting of packaging). The IPPC dataset was more current (2011). It was also broken down into more detail, with waste arisings categorised under European Waste Catalogue (EWC) codes. To classify this in line with the FDF data (packaging, mixed, food waste), these codes and their descriptions


were inspected and individually classified into the three FDF categories (a list of how codes were aligned is provided in Annex 3). Where a classification was unclear, they were put into „Other‟. This resulted in a list of sites for which waste arisings were broken down into three main categories: packaging, mixed and food waste (and „Other‟), just as in the FDF data. CC2 data were unsuitable for use in calculating waste composition due to the lack of differentiation of tonnages into compositional categories within the data. Of the total waste arisings in the CC2 data used for this analysis (excluding grocery retail), only 14% are split into the three categories (food or product; packaging; and mixed, unknown or other). Of this 14%, 73% falls into the „mixed, unknown or other‟ category, and just 1% into „food or product‟. The extent to which this differs from the FDF and IPPC data suggests that the 14% is highly unrepresentative of the „not split out‟ waste, and therefore the CC2 data were considered unreliable in this instance. To estimate waste composition, the IPPC and FDF data were combined. This was done in the same way as previously, inspecting and removing duplicate sites, classifying by sector and grossing up using the ONS IDBR totals. The final composition obtained through this method was 78% food, 10% other, 7% packaging and 6% mixed.

Table 11: Waste composition summary (2011)

Type of waste % of Total

Food 78%

Packaging 7%

Mixed 6%

Other 10%

N.B. these % figures have been rounded- the final tables have been calculated using non-rounded percentages and so may

differ from the totals in Figure 2 and other data presented in this report.

3.5 Waste fate Waste fate (method of management) was calculated based on the average fate for types of waste (food or packaging). This was derived by combining the average fate in both the IPPC and FDF data. This was done simply by adding each site in the two datasets and removing duplicates. The total tonnages going to each fate were then taken as a percentage. These percentages were applied to reach the specific total. The final totals were then calculated by using the fate data in conjunction with the above compositional percentages (the IPPC composition was used in this case). For example, to find how much food waste was sent to land-spreading, the initial figure of 3.8 m/t was used as the total food waste (78% of the total waste arisings). The percentage of food waste that was sent to land-spreading, as calculated above, was 52.9%. This was applied to the food waste total, calculating an estimated 2.3m/t of food waste going to land-spreading. The CC2 dataset was not used in this case, as, although the fate of the waste is largely recorded, the majority of the data do not include the type of waste. While the CC2 reporting incudes waste to sewer, this disposal method has not been included in this report largely because of confidentiality issues and because no additional data sources were available.


3.6 Breakdown by country The breakdown by country was estimated using the IDBR country split by local sites. It was assumed that waste would be divided between countries in the same proportion as number of sites units. Therefore the percentages for each country were directly applied to the overall waste tonnages. This was done by 3 digit SIC code, to account for sector specific variation by country. This ensures that the different business structures between the nations are reflected in the calculations. The CC2 total that is not broken down by sector was divided according to the average overall proportions, and added on at the end.

Table 12: Country breakdown of sites by SIC

Sector England Wales Scotland Northern Ireland

101=Meat 78% 5% 10% 7%

102=Seafood 49% 1% 44% 6%

103=Fruit & veg 80% 4% 6% 10%

104=Oils & fats 85% 8% 8% 0%

105=Dairy 72% 8% 13% 7%

106=Grain 84% 3% 8% 5%

107=Bakeries, bread 80% 5% 9% 5%

108=Sugar/chocolate/tea/coffee & other 84% 6% 7% 3%

109=Animal & pet food 76% 6% 8% 11%

110=Drinks 75% 4% 19% 2%

N.B. these % figures have been rounded- the final tables have been calculated using non-rounded percentages

These percentages are then applied to the waste totals and the results shown below.

Sector Grossed up Total England Wales Scotland Northern Ireland

101 1,356,409 1,059,695 74,179 132,462 90,074

102 21,236 10,353 265 9,291 1,327

103 246,470 197,664 9,761 14,642 24,403

104 33,233 28,120 2,556 2,556 -

105 338,172 241,923 28,615 44,222 23,412

106 41,706 34,943 1,127 3,382 2,254

107 295,142 237,310 15,455 27,420 14,957

108 297,456 248,391 18,399 21,466 9,200

109 69,185 52,393 4,030 5,374 7,389

110 566,855 425,141 23,619 106,285 11,809

CC2 Total: 1,139,431 77,182 171,870 77,978

Total Waste: 3,675,364 255,189 538,969 262,803


4.0 Wholesale: Method This section outlines the method used for estimating waste and other flows in food and drink wholesaling. The following data sources were used.

Table 13: Data sources information


Survey 2012 The aim of the survey was to fill in some of the data gaps that exist around wholesale. Individual organisations were asked for their food/packaging waste tonnages.

C&I 2009 Re-analysis of Defra 2009 C&I Waste Survey in England.

4.1 Wholesalers survey Grocery wholesalers can be categorised into four different types, distinguished by the key customer groups they serve and the platform from which they serve them. 1 Specialist wholesale markets: specialist markets that are of localised importance in major cities supplying certain categories of product only to independent grocery retailers (including street markets) and caterers. 2 Cash and carry wholesalers: supply a wide range of food and grocery categories with the majority of sales made through self-service depots. Their primary customers are independent grocery retailers and caterers, but may also have significant secondary customer bases in catering and general business users. 3 Delivered grocery wholesalers: these operators supply product solely by delivery service, to customers in the grocery retail sector. These customers are primarily independent and convenience grocery retailers which may also include multi-site operators. 4 Delivered foodservice wholesalers: these delivered operators service a wide range of businesses in the foodservice and hospitality sector including cafes, restaurants, quick service restaurants, staff canteens, schools, prisons and hospitals. As well as „broadline‟ wholesalers the segment also includes many product specialists, with a limited category focus in areas such as meat and fresh produce. 4.2 Market size According to IGD, the wholesale sector (with the exception of specialist wholesalers) was valued at £26.6 billion in 2011. The cash and carry sector accounts for 42% of the market and was valued at £11.3 billion, delivered grocery represents 34% (£8.8 billion) and delivered foodservice 24% (£6.4 billion). IGD provides no estimate of the size of the specialist wholesale market sub-sector. A summary of some of the data IGD have gathered is shown in Figure 9 as an example. 2011 data was used in this study. Figure 9 shows 2012 data. The National Association of British Market Authority (NABMA) estimates that specialist wholesale markets had a turnover of £4.1 billion in 2009 and that 26 were operative. The same report (Markets - 21- Report) estimates there were 1,124 traditional street markets and 605 farmers markets.


Figure 9: IGD retail wholesale market data

4.3 Scope For this review, groups 1, 2 and 3 above are included, while group 4 (Brakes and 3663 are the main companies) is excluded as it caters mainly for the hospitality sector. Table 14 shows the key players:

Table 14: Wholesale sectors and key players

Specialist wholesale markets

Cash and carry wholesalers

Delivered grocery wholesalers

London: Covent Garden Spittlefields Smithfield Billingsgate

Booker Bestway Makro Costco Blakemore Parfetts Dhamecha

P&H McLane Musgrave Retail Partners Spar wholesalers: CJ Lang & Son James Hall & Co AF Blakemore Appleby Westwood John Henderson

4.4 Methodology A questionnaire was designed to capture all of the required information (see Annex 1). All of the organisations in Table 14 were contacted, to try to obtain responses from the majority of the market.


4.5 Wholesalers data analysis The C&I waste survey 2009 contains a good coverage of the wholesale sector, with waste audit data obtained from more than 100 sites classified as food wholesalers. As the business classification did not differentiate sites supplying hospitality and foodservice sector (i.e. types 3 and 4 above) from those supplying independent stores and markets, it was necessary to use the IGD wholesale market data to estimate the grocery retailer component. Table 15 provides the tonnage estimates for the grocery retail component of wholesale, split by the main compositional categories and waste management route. The mixed waste component is likely to contain food and packaging wastes.

Table 15: Wholesale food and packaging waste, UK (based on Defra 2009)

Fate

Food waste Mixed wastes

Packaging Other Total

17,297 52,084 73,839 4,398 147,618

Recycling 10,707 7,696 65,809 3,858 88,070

Disposal 6,590 44,388 8,029 540 59,547


5.0 Grocery Retail: Method This section outlines the method used for estimating waste and other flows in food and drink grocery retailing. The following data sources were available.

Table 16: Data sources information


CC2 2011 Used as basis of grocery retail waste estimates for known market segment.

Kantar 2012 Sales by volume market share.

Data were held for a significant number of CC2 grocery retail signatories comprising a significant proportion of the market. The total grocery retail waste for the UK was calculated on the assumption that the CC2 portion of the grocery retail market is representative of the remainder. Market share for included CC2 signatories was calculated first, followed by a one-stage grossing up to obtain the remaining percentage of the market. Market share was based on sales by volume, using the Kantar data, as this is the most relevant proxy with regard to estimation of total waste arisings (it was assumed that sales volume was a better predictor of waste than sales value). The CC2 data was estimated to account for 80% of the market (by sales volume). Thus the 2011 figure of 1,195,489 tonnes was grossed up to a total of 1,494,361 tonnes of waste arisings for the total UK grocery retail food and drink sector. 5.1 Grocery retail waste fate The CC2 data were largely aggregated in terms of type, with approximately 40% of the total waste arisings unattributable to „food‟, „packaging‟ or „mixed‟. Thus it was unsuitable for usage with regards to breaking fate down by composition. For each fate, a „typical‟ profile of waste type was calculated using the IPPC data. For example, it was calculated for all food waste, what percentage went to landfill, what went to land-spreading, and so on. This was done individually for each waste type. The percentages were then applied to the previously estimated CC2 waste tonnages. Through this route it was determined where to attribute the aggregated waste for each fate. For example, landfill was - where not split out - all attributed as „mixed‟. This allowed the remainder of the waste to be split into either food, packaging or mixed. The individual totals were then scaled up in the same proportions as those for the overall waste production. 5.2 Grocery retail split by country For the country split of grocery retail, sales volume data were inappropriate as they were based on TV broadcasting regions. For instance, Wales‟ share was distorted by inclusion of the „West‟ TV region within the Wales total. Instead estimates were therefore made according to the population of each country. The percentage of the UK population in each country was applied to the overall waste estimate, thus producing approximate figures for the nation split of grocery retail waste. This same methodology was used to provide a


country split for total food and packaging waste (once the mixed waste portion had been split out).


6.0 Animal Feed: Method This section outlines the method used for estimating waste, by-product and other flows used as an ingredient in animal feed. The following data sources were available for food sent from the grocery sector into animal feed manufacture.


Survey data 2012 A survey was carried out to (1) further understand the structure of the animal feed market and (2) obtain data from animal feed manufacturers as to the tonnages of by-product they receive.

CC2 2011 CC2 animal feed total was added on at the end of the grossing up process.

FDF 2008 Provides the basis for grossing up.

Defra, GB retail production of animal feedstuffs-dataset (Defra feedstuffs dataset)

2011/12 Provides a summary of all material (including raw material and by-products) going to animal feed in the UK.

FeFac 2012 Survey based research indicating the total tonnages of foodstuff going to animal feed.

WRAP Drinks Resource Map- Summary and overview

2010 Provides a final estimate of product from the drinks sector going to animal feed.

6.1 Scope This data collection exercise aims to identify the amount of food and drink that is sent by the grocery supply chain to provide an ingredient for animal feed. Some food and drink used in animal feed may have been discarded as „waste‟, while other food and drink may not be formally classified as a waste but is best described as a „production residue‟. These may also be described as „co-‟ or „by-‟ products. Some of this material will be animal by-products as defined by EU legislation, and will require rendering. Rendered material is used in the production of pet food but cannot be fed to farmed animals32. All food and drink used in animal feed is in scope, except for such material as is sent to pet food manufacturers. 6.2 Data analysis WRAP has published figures (2010) indicating there are 2.2 million tonnes of by-product sent to animal feed from the manufacturing stage of the chain. This is based on a survey of FDF members which shows that 512,000 tonnes of by-product was sent to animal feed and then scaled to provide the published estimate. Later work with FDF members shows that, in 2008, 341,82833 tonnes were sent to animal feed, with 357,256 tonnes in 2009. The samples from the two studies differ and in the later study the data have not been scaled to provide a comparison with the published data in the WRAP report. These figures do not include tonnages of the following materials known to be sent to animal feed:

32 Rendering figures are excluded in this section

33 Although these figures are estimates we have quoted actual rather than rounded data in this section.


British Sugar: after extracting sugar from sugar beet, the pulp is pressed to generate over

500,000 tonnes of high quality animal feed; either as moist pulp or dried pellets.

WRAP Drinks Resource Map: some 1.2 million tonnes of spent grain is used in the

manufacture of animal feed.

6.3 Methodology In order to calculate the best estimate of total food and drink being sent to animal feed, a number of information sources were explored. These included:

Analysis of data from grocery supply chain sources. Data for food and drink to animal

feed from the FDF and CC2 datasets were grossed up to provide a UK estimate (this is

discussed in more detail in sections 6.5 to 6.9).

A survey of animal feed manufacturers:

A number of animal feed manufacturers were contacted to obtain data on the amounts of food and drink collected/sent by grocery retailers/manufacturers/wholesalers.

The survey was also used to try and obtain a greater understanding of the structure of the animal feed market; essential for realising the potential of grossing up any of the figures obtained through the survey.

Use of alternative estimates and new data sources:

Through discussions with survey participants, it was also possible to obtain some industry data sources.

The Defra feedstuffs dataset gave a good cross check for other estimates.

6.4 Analysis of existing data The IPPC data excludes animal feed (as defined as „co-‟ or „by-‟ product) and was therefore not used and the CC2 data provides no breakdown by sites, companies or sector. The 2009 Defra C&I survey was also assessed for coverage of animal feed, but it was not possible to reliably use it to identify wastes that were converted to animal feed. Two figures were produced. The first one used only FDF data, whereas the second took into account the CC2 data. Both figures were produced following broadly similar methods, as outlined below. 6.5 Sector categorisation Just as with the waste estimates discussed in Section 3 in relation to food/drink manufacturing, the methodology for grossing up the animal feed estimates used the sector coding provided by the UK SIC (2007). Where animal feed was concerned, the FDF dataset covered the following SIC codes and categories and numbers of sites for each were identified.


Table 17: Sectors‟ coverage of sites sending product to animal feed, FDF 2008 dataset

SIC 3 Digit Code Description

102 Fish

103 Fruit & veg

105 Dairy

106 Grain

107 Bakeries, bread

108 Sugar/chocolate/tea/coffee

Source: Oakdene Hollins calculations based on SIC codes

Sites remained in the same size bands that they had been classified under as in the manufacturing waste methodology. The number of sites is not shown in the table. 6.6 Obtaining final estimates The process for obtaining figures for animal feed is the same as the previous process for waste. However, it differs from the previous waste estimates in the final stage. Rather than producing separate totals for size bands 1-2 and 3-4 (1-99 and 100+ employees) for both the FDF and FDF+CC2 totals, the proportions for each have been estimated. Animal feed is (roughly) proportional to the amount of food waste produced, and the total amount of food, packaging and mixed waste. With this in mind, the Defra C&I waste survey (2009) data on waste arisings by site - broken down by number of employees - were used to estimate the proportion of animal feed for which the smallest size bands are responsible. In the Defra 2009 report, size band 1 (1-49 employees) was responsible for 7.9% and size band 2 (50-99) for 12.2% of the food, drink and tobacco sector‟s annual waste arisings. These were scaled down slightly, to 5% and 10% respectively, to account for the greater tendency of larger production sites to divert material to animal feed. As a result, it was estimated that the two largest size bands would account for 85% of the total animal feed. Therefore, the animal feed totals (once multiplied up in accordance with the IDBR data) would be seen as representing this 85%. The final part of the scaling up process, therefore, was using this figure to estimate the value for 100%. Table 18 provides an example of this grossing up process. In this figure, sites have already been classified by size and sector. The number of sites is not shown in the table. The data (first column) is grossed up by a multiplier to equate the number of sites surveyed with the IDBR total. This produces the grossed up total that accounts for all UK sites. The total is then scaled up to the full 100%.


Table 18: Size bands for grossing up data (number of sites is not shown).

Total

recorded

animal

feed

(tonnes)

Multiplier

Grossed

up Total

(tonnes)

85%

total

Final

total

(100%,

tonnes)

Size

band 3 7,060 8 56,480

169,079 198,917 Size

band 4 37,533 3 112,599

The figure from British Sugar was not included in the original grossing up process; being a large producer of animal feed it would distort the final figure. Therefore, this final total should then be added to the British Sugar total of 500,000 tonnes, to reach a final grossed up estimate of 1,792,974 tonnes. The estimate for grain is considerably less than WRAP estimate referred to at 6.2 above probably reflecting the structure of FDF membership and the likelihood that spent grain is also sent to AD. 6.7 FDF+CC2 animal feed A second grossing up exercise was also done, this time incorporating the CC2 data in a method broadly similar to the FDF-only approach. However, this time, CC2 sites were removed from the grossing up process, and the ONS IDBR numbers adjusted to reflect this change. The overall CC2 total was then added on at the end, after scaling up from 85%. As before, the 500,000 tonnes for British Sugar was added at the end of the process, giving an overall estimate of 1,832,205 tonnes from manufacturing, excluding the CC2 data. Only manufacturing was analysed in this instance because it is the key industry for animal feed, with grocery retail and wholesale responsible for far less production. 6.8 Animal feed survey, structure of the animal feed market A survey was undertaken of the main feed manufacturers, with nine companies identified as appropriate to contact, and five responding with data. It was important to understand the classification of product routes in animal feed manufacture:

Figure 10: Structure of animal feed market In order to avoid double counting across this supply chain, tonnage had to be taken from either the intermediaries or from the manufacturer stage.

Food and drink sent for animal feed (from manufacturer/wholesale/ grocery retail etc.

Product sent to intermediary who then supplies feed manufacturers

Manufacturer of animal feed takes from intermediary OR direct as raw materials


A further complication is introduced when intermediaries purchase product from each other to create custom blends. This would also contribute to double counting. Although the results from the survey did not prove sufficiently comprehensive to be solely used as estimates, discussions with manufacturers did highlight other available data sources. The survey produced some very good data, with nation and provenance split as well as overall tonnages. However, the major problem has been to identify double counting of tonnage between feed processors/intermediaries and feed manufacturers. Data from the two largest manufacturers (operating as both primary manufacturers and intermediaries) gave a combined total of 1.6 million tonnes. However, it is not possible to gross this up as it is not clear what proportion of the animal feed market this represents. Through the survey discussions, several animal feed manufacturers were able to indicate where existing published or industry data could be found. These sources have been used to calculate the final estimates. 6.8.1 FeFac (2012) Feed use of former foodstuffs. Particularly useful from this study was the UK case study detailing tonnages of „former foodstuffs processing into feed‟. This case study estimates that 455,000 tonnes of former foodstuffs (including bread, broken biscuits, misshaped pralines, dough trimmings, over-flavoured crisps, incorrectly packaged products and seasonal products) are processed back into animal feed. This includes the categories shown in Table 19.

Table 19: FeFac Former foodstuffs processing into feed (2012)

Food category Tonnes

Bread and bakeries 177,000

Cake 30,000

Breakfast cereal 21,000

Biscuit/cracker bread 23,000

Crisps/snacks 14,000

Dough 3,500

Flour/bread crumbs 10,000

Chocolate/confectionary 18,500

Dairy products 8,000

Uncharacterised 150,000

Total UK 455,000 Source: FeFac (2012)

6.8.2 Defra feedstuffs dataset Also of particular use was the Defra feedstuffs dataset detailing tonnages of raw material going into animal feeds. However, the proportion from the food and drink industry – the „co-‟ or „by-‟ products/waste – is not clearly split from the primary ingredients. This dataset has been used as a cross check against estimates produced from other sources. These checks include:

British Sugar quote a figure of 500,000 tonnes of product going to animal feed.

The Defra feedstuffs dataset states that in 2011 529,500 tonnes of „molasses‟ plus „sugar beet‟ were being received by animal feed producers. This is a more up-to-date figure than the „rounded‟ estimate above and should be used in any totals.


FeFac provided a total tonnage of foodstuff, included food waste and confectionery, equal

to 455,000 tonnes (2011).

The Defra feedstuffs dataset states that in 2011 a total of 523,700 tonnes of „other materials‟34 plus „confectionery by-products‟ were being received from animal feed producers. Although these figures cannot be further split, this provides a positive check against the FeFac total.

The following categories are taken from the Defra feedstuffs dataset and are believed to indicate food or drink by-product into animal feed in 2011, along with confidence levels:

6.8.3 Food and Drinks Resource Map WRAP‟s Drinks Resource Map quotes a figure of 1.2 million tonnes of by-product going into animal feeds from food and drink production. The Defra feedstuffs dataset gives a 2011 figure of 507,000 tonnes. This was difficult to use because of unclear categorisation and so the WRAP figure was used (It was confirmed that companies do not always enter data in the correct categories (by-product or food), so the data cannot provide a definitive answer as to where the tonnages lie for brewery in particular). The tables below give two estimates of final figures, the first using the FeFac food totals, and adding in drinks from the resource maps and sugar by-products from the Defra feedstuffs dataset, the second using the Defra data and adding in by-product information from the resource map.

34 Further clarification of these headings was not available from the author. However, it was suggested that food waste products would be included under „other materials‟ and „confectionery‟

Category – high confidence in data Tonnes

Molasses 286,800

Dried sugar beet pulp 242,700

Confectionery by-products 234,400

Distillery by-products 358,600

Total 1,122,500

Category – medium confidence in data Tonnes

Other Materials (food products excl. confectionery) 289,300

Other cereals by-products (includes brewery) plus citrus fruit/pulp 204,400

Total 493,700

Total UK estimate from Defra data 1,616,200


Table 20: Animal feed summary

Source Tonnes

Total food to animal feed Compiled by FeFac 455,000

Drinks sector Drinks Resource Map 1,200,000

Sugar by-products Defra feedstuffs dataset 2011 529,50035

TOTAL 2,184,500

Source: Oakdene Hollins estimate based on Defra feedstuffs dataset (2011), FeFac (2012) & WRAP Drinks Resource Map (2010)

Source Tonnes

Total food to animal feed from Defra Foodstats

Defra Foodstats data 2011 523,70036

Sugar by-products Defra feedstuffs dataset 2011 529,500

Drinks sector Drinks Resource Map 1,200,000

TOTAL 2,253,200

In comparison, the estimate from the FDF and CC2 data combined comes to 2.4 million tonnes. Therefore, the overall tonnage is estimated to be between 2.2 and 2.4Mt with our preferred estimate of 2.2Mt at the lower end (Table 20, 2,184,500). 6.9 Avoidable/non-avoidable waste To estimate an avoidable/non-avoidable split, by-products from the drinks sector and British Sugar can be assumed to be unavoidable. These categories consist of spent grain etc. from brewing, distillery and soft drink manufacturers, and sugar beet, molasses and other by-product from British Sugar. The remaining category, „food to animal feed,‟ is more difficult to split. As a minimum it is assumed that 10% of this is unavoidable. We have based this on waste prevention reviews undertake by WRAP and so includes product wasted due to quality concerns and changeovers (which could be reduced through further optimisation) rather than on the inherent characteristics of the food (as this information is not available). This approach gives an estimate of 50,000 tonnes. However, 45% of the 500,000 tonnes total is estimated to be unknown (see section 8 for details of this). This is displayed in Table 21.

35 High confidence in this figure, and as such this figure is preferred over the „rounded‟ website figure of 500,000 tonnes from British Sugar

36 Less reliable than the FeFac data in the first table, due to unclear categorisation


Table 21: Animal feed, potential waste/non-waste estimates

Total tonnage

Avoidable (tonnes)

Un-avoidable (tonnes)

Unknown (tonnes)

Total FOOD to animal feed 500,000 225,000 50,000 225,000

Drinks sector 1,200,000 - 1,200,000 -

Sugar by-products 529,500 - 529,500 -

TOTAL 2,184,500 225,000 1,779,500 225,000

Therefore, as a maximum, an estimated 450,000 tonnes of product to animal feed can be deemed avoidable (avoidable + unknown). Legally, this material is not waste but it is a loss to human consumption. 7.0 Food charities: Method Redistribution of food and drink for human consumption is specified clearly within the scope of CC2, as part of the supply chain target (now the Manufacturing and Grocery Retail target under CC3). Redistribution can comprise several routes including through companies like „The Company Shop‟ and charities. This section outlines the estimate we have made for redistribution through charities. 7.1 Data A survey of FDF members showed that 171 tonnes of food were donated to charities for human consumption in 2008, falling to 111 tonnes in 2009. According to published reports from the charities, approximately 4,700 tonnes of food annually are channelled through UK food charities. All charities report an increase in demand for their services over the past year and plan to handle an increased quantity of food. A survey was undertaken in order to provide a more accurate figure for the total amount of food being redistributed in this way. 7.2 Methodology

A contact list was identified for all of the major UK food charities, including:

FareShare

The Trussell Trust

The Food Bank

Real Aid

Food Cycle

His Church

Esther

Each charity was contacted directly to obtain data from each on the amount of food

donated and its sources.

Any food charities out of scope of this project were excluded (for example The Trussell

Trust and The Food Bank who receive food primarily from the general public).

7.3 Survey summary The following tables show results from the surveys for relevant charities. The largest charity was unable to provide a tonnage split for food and food packaging. To calculate the total UK figure, the total tonnage from this organisation (named as Charity A in Table 22, below) was split based on the average food: packaging split of the other charities (Table 22).


Table 22: Data collected from individual charities

Charities providing food: packaging split

Total food (tonnes) Total packaging (tonnes)

Total 1,867 281

% 87% 13%

Charity A Total food (tonnes) Total packaging (tonnes)

Data provided 3,600 No data

Estimated split 3,129 471

Charity Total food (tonnes) Total packaging (tonnes)

TOTAL UK* 4,996 752 Source: Oakdene Hollins survey results

* number of organisations= 5

With the exception of one organisation, all the charities gave data relating to where food is sourced e.g. from grocery retail/wholesale/depots/manufacturing. A percentage contribution to all of the charities from various sources was calculated and used to apportion the products received from the organisation that did not provide this detail. This produces the following UK estimates:

Table 23: Charity data (food and packaging) split by source

Charity Grocery retail (tonnes)

Distribution (tonnes)

Wholesale (tonnes)

Manufacturing (tonnes)

TOTAL UK* 2,117 493 44 3,094 Source: Oakdene Hollins survey results * number of organisation=5

The following table provides an estimate only of the split between food and packaging, by source. It has been assumed that the food received by charities will always be packaged. Food and packaging tonnes have been attributed to the split by source, outlined in Table 24.

Table 24: Estimates charity food and packaging, split by source

Charity Food (tonnes) Packaging (tonnes)

Grocery retail

Distn. W.Sale Manuf Grocery Retail

Distn. W.Sale Manuf.

TOTAL UK*

1,811 432 38 2,716 307 61 6 378

Source: Oakdene Hollins survey results * number of organisation=5

It is not possible to estimate the split of food redistribution across nations from the data provided in the survey. Most charities were able to provide an indication of the regions in which they operate, but no further breakdown of tonnages arising in each of these. Note, although depots are a separate category here, for the purposes of the Executive Summary tables depots have been combined with grocery retail as this food is generated from the grocery retailers‟ distribution system.


8.0 Economic and environmental impact In this section we provide estimates of the economic and environmental impacts of food and packaging waste. The cost of waste can be quantified in monetary terms by estimating the ingredient and other costs (including energy, water and labour for example), disposal costs and lost profits. These represent a cost to business through lost sales. They also represent a cost to the environment measured by the embedded carbon and water that have been consumed and subsequently wasted. 8.1 Value of a tonne of waste WRAP has previously estimated that food and packaging waste in the supply chain was costing business some £5bn. This was based on a valuation of waste at £500/t in manufacturing. This figure was based on the work of Envirowise and is now dated. A new estimate of the value of food waste in manufacturing has been derived using a bottom up approach based on the following elements:

Evidence from the 26 waste prevention reviews undertaken for WRAP between 2010 and 2012 (this work is on-going through 2013);

A significant amount of food inflation over the period 2008 to 2013; Actual costs of disposal (which have increased since 2008) and the actual costs of

water use per tonne of food produced; Nationally available indicies on labour and energy costs converted to a per-tonne

basis. On this basis we estimate the value to manufacturing of a tonne of waste is £950/t. This figure includes the cost of the food/ingredients, energy and water costs, disposal costs and lost profit. Approximately 12% of this total is profits and capital expenditure costs, 10% is disposal costs and the rest ingredient and production costs. Because there is a significant amount of food that goes from manufacturing to animal feed we have developed an estimate that takes account of the revenue obtained less the disposal costs, which is £820/t to be applied to this flow. Although strictly not waste (legally) this food is lost to human consumption and is a cost to business. We have not included the value of this material in our estimate below but the food, potentially, could have been eaten by people. To obtain an estimate for the value of grocery retail waste, we have assumed that grocery retail adds around 20% to the total costs in the chain, including margins (there are significant variations of course across grocery retailers/products and timescales)37. On this basis we estimate the cost per tonne of food wasted at grocery retail to be £1200/t. It is likely that the waste profile of grocery retailers will be different to that of manufacturers but we have been unable to make any adjustments to the estimate. For wholesale we have simply assumed a figure of £1,000/t. This is a somewhat arbitrary estimate reflecting the additional costs (over manufacturing) incurred through distribution and storage for example. A figure for packaging of £1,600/t has been derived using information from the waste prevention reviews referred to above. This figure has been rounded down and has been determined from submitted data from 13 waste prevention site reviews conducted for the

37 See: ECR Efficient Unit Loads project, A T Kearney. Although dated, this is the best estimate available and is unlikely to have changed significantly. Some work has also been undertaken in the US to estimate these costs.


Food and Drink Federation during 2009-2010. The estimate was determined by taking the total value of packaging wasted using purchase cost data and dividing that number by the total number of tonnes recorded as wasted. It does not include any overhead costs such as direct and indirect variables, fixed overheads or energy costs. 8.2 Economic impact In order to estimate the total value of waste to the supply chain it is necessary to determine the extent to which wastes are avoidable. For food and packaging waste arising in grocery retail and wholesale, this is relatively straightforward, as all of this waste is in principle avoidable, as it is all fit for human consumption. For manufacturing we have also assumed that all waste is avoidable (we also have an estimate of avoidable food that is sent as an ingredient in animal feed, but which is not waste). It is possible that a small proportion of manufacturing waste is unavoidable though it appears that the majority of this material is disposed to animal feed. The table below shows our estimate of the value of food and packaging waste, namely £6.9bn. The value to business as a proportion of consumer expenditure on food and drink is around 7%.

Table 25: Value of food and packaging waste

Sector Total tonnage* (M/t)

£/tonne Total (£bn)

Manufacturing: Food Packaging

3.9

0.48

950

1600

3.71 0.77

Grocery Retail: Food Packaging

0.43 1.07

1200 1600

0.51 1.71

Wholesale: Food Packaging

0.02 0.12

1000 1600

0.02 0.19

TOTAL WASTE/VALUE Animal Feed

6.02

0.45

-

820

6.91

0.37

* Excludes „Other‟ Manufacturing waste Although not waste, adding the value of potentially avoidable food losses sent to animal feed gives an overall total of £7.28bn. 8.3 Environmental impact The environmental calculations have been carried out in two ways: emissions attributable to waste and opportunity cost. Across WRAP‟s work, the impact of agriculture, manufacturing, grocery retail and distribution are allocated to the food which is purchased by households. This means that no impacts are allocated to the creation of waste produced at each of these stages. For consistency, it is


therefore appropriate only to attribute disposal emissions to the food waste. Table 26 provides estimates for the GHG emissions associated with wasted food by grocery retail and manufacturers. This is estimated at 250,000 tonnes CO2e.

Table 26: Greenhouse gas emissions

Weight of waste (tonnes)

Waste disposal emissions (tonnes CO2 eq)

Management

Gro

ce

ry r

eta

ile

rs

Ma

nu

factu

rers

Gro

cery

reta

ilers

Manufa

cture

rs

Landfill

45,000 0 20,250

Recycling

1,300,000 0 -50,700

Thermal

400,000 0 -35,600

AD 19,000

-3,078 0

Land spreading

2,000,000 0 60,000

Other 1500 81,000 675 36,450

Unknown 400,000 100,000 180,000 45,000

Total m/t 0.4 3.9 177,597 75,400

Total 252,997

However, there is also an opportunity cost associated with the wasted food. The opportunity cost is the value of the best alternative forgone. This is derived using information collated by WRAP on the life cycle impacts associated with the production of food fit for human consumption (Table 27). Assuming that the wasted food could have been avoided, the opportunity cost is approximately 13 million tonnes of CO2 eq. If, however, it was not suitable for human consumption, but was suitable for animal feed, the opportunity cost would be 1 million tonnes CO2 eq.


Table 27: Opportunity costs

Weight of waste (tonnes)

Opportunity cost :

human consumption (tonnes CO2 eq)

Opportunity cost:

animal feed (tonnes CO2 eq)

Management

Gro

ce

ry r

eta

ile

rs

Ma

nu

factu

rers

Gro

ce

ry r

eta

ile

rs

Ma

nu

factu

rers

Gro

ce

ry r

eta

ile

rs

Ma

nu

factu

rers

Landfill 45,000 0 155,250 0 27,450

Recycling 1,300,000 0 3,849,300 0 157,300

Thermal 400,000 0 1,164,400 0 28,400

AD 19,000 68,400 0 -38 0

Land spreading 2,000,000 0 6,060,000 0 380,000

Other 1500 81,000 5,400 279,450 915 49,410

Unknown 400,000 100,000 1,440,000 345,000 244,000 61,000

Total 420,500 3,900,000 1,513,800 11,853,400 244,877 703,560

Total 13,367,200 Total 948,437

In addition to the food waste, the whole life emissions associated with wasted packaging are estimated to be 800,000 tonnes CO2e at manufacturing, and 1.9 million tonnes CO2e at grocery retail and wholesale. For an explanation of the derivation of WRAP‟s carbon factors please see Zero Waste Scotland (2011) and WRAP (2011)

http://www.zerowastescotland.org.uk/carbonmetric

http://www.zerowastescotland.org.uk/carbonmetric

http://www.wrap.org.uk/content/water-and-carbon-footprint-household-food-and-drink-waste-uk-1


9.0 Changes between 2008-2011 Over the long-term, levels of food and drink waste in the grocery sector were almost halved between 2002-03 and 2009, down 49%.38 In developing CC3, a „counterfactual position‟ was established that took into account likely sales increases as well as „business as usual‟ efficiency improvements to assess the impact on waste levels. Other factors will also impact on waste levels; since 2009 there has been a squeeze on household incomes with price becoming the key driver of store and food choice. Arguably the focus on price both in the supply chain and in the household should lead to further reductions in waste. However, more products are being sold on promotion and there has been a shift in shopping patterns to smaller, convenience stores both of which could increase waste. Evidence from signatories to the second phase of the Courtauld agreement shows that a relatively small absolute reduction in waste was achieved in the first year (0.4%) and that this increased to 8.8% in the second year (2011), well ahead of the 5% target. Final results from the second phase will be reported in 2013. It seems reasonably safe to conclude that supply chain waste has continued to fall since 2009 though the rate of change remains uncertain. It is not possible to shed any further light on these trends from the work reported here. In Table 28 below we have set out the „headline‟ results from the 2008 research and the results from this 2011 update. The issue is the extent to which differences in the two results can be attributed to methodology, relative accuracy of data sources, differences in scope and definitions and how far the differences relate to real trends.

Table 28: Differences between 2008 and 2011 (nearest 1,000t)

Supply Chain Stage 2008 ‘best

estimate’

2011 ‘best

estimate’

Difference Key methodological differences and result

Manufacturing 5,016,000 4,919,000 -2% Increased accuracy; more data sources and a slightly modified approach.

Wholesale 147,000 No comparable data for 2008.

Grocery Retail 1,464,000 1,494,000 +2%

Increased accuracy; the 2011 estimates took a new approach and used different data with a higher coverage.

Animal Feed 2,200,000 2,184,500 -1%

Increased accuracy; higher coverage, more detailed approach and reduction in double counting.

38 See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/183302/foodpocketbook-2012edition-09apr2013.pdf


The overall outcome from this exercise is that differences in methodology and data coverage largely explain the differences between the two years and that any trends that have occurred are masked by these differences. The nature of these differences between the 2008 research and this current work are explained more fully below. 9.1 Grocery Retail In both 2008 and 2011, the grocery retail total was grossed up from data that included some of the largest UK grocery retailers. However, there were several key differences: Number of grocery retailers: In 2008, data from four of the largest UK grocery retailers

was used. The 2011 estimate from Courtauld included seven. Data collection: For the 2008 study, data were based on a DHL survey of grocery

retailers from 2009. The 2011 estimates are based on company reporting through the Courtauld Commitment and are therefore reported tonnages which are likely to be more directly „owned‟ (and validated) by the sector than estimates derived from the DHL survey.

Market share calculation: In 2008, market share was calculated by turnover, whereas in 2011 it was calculated by sales volume. The latter is a more accurate way to estimate total waste, as volume of sales has a closer relationship with waste tonnages than does turnover. For comparison, the 2011 figure was recalculated using market share by turnover, resulting in an estimate of 1,380,000 tonnes (a decline of 6%), from a coverage of 88%. Sales volume data were not available alongside the DHL survey data to perform the reciprocal calculation for 2008.

Market share coverage: In 2008, the data were grossed up from 60% coverage of the market. In 2011, it was grossed up from 80%. The higher proportion in 2011 is likely to significantly reduce any potential bias in the component of the sector not covered.

Scope: Some grocery retail distribution (depot) data were included in the 2008 figure. This cannot be separated out using the available data supplied by Courtauld signatories.

Overall, the changes in the methodology should be seen as an improvement in accuracy. A more comprehensive dataset was used for the 2011 figure; it was more accurate in its usage and displayed a higher coverage. 9.1.2 Composition of waste 2008: The waste composition was calculated and grossed up from the same 2009 DHL

survey as the total waste figures. However, the composition of waste sent to landfill data was grossed up from a skip analysis, done by just one grocery retailer. It was assumed that this was representative.

2011: Composition was derived from the CC2 data. However, approximately 40% of the total waste arisings were „not split out‟, with no compositional information. Thus a generic waste profile was derived, using a combination of available waste fate data and the IPPC data. There is a relatively low confidence in these figures.

These are entirely different methods, each with its own problems. However, accuracy is arguably higher in the 2011 estimate as, although there is a margin of error in the waste profiling, the waste data are taken from seven grocery retailers in the CC2 data, rather than just one. 9.1.3 Fate of waste 2008: The fate estimates were calculated in the same way as composition and totals, i.e.

grossed up from a survey of four grocery retailers. 2011: Estimates were grossed up from the CC2 data, just as with total waste estimates.

Unlike composition, fate was fully split out in CC2 data (for total waste to each fate).


As with total waste, the changes in the methodology are an improvement in accuracy, with more current and comprehensive data and a more accurate usage. 9.2 Manufacturing The total waste estimate for manufacturing in 2011 was approximately 97,000 tonnes, or 2% less than in 2008. However, the two baselines used very different methodologies to compile their estimates. The 2011 estimate used more data sources and developed a method to allow these sources to be used in combination whilst minimising the risk of overlap. This approach should be seen as a refinement, resulting in a more accurate figure than that for 2008 because the combination of data was designed to reduce biases (such as the under-representation of the drinks sector in the FDF survey, underpinning the 2008 manufacturing estimates).

Extrapolation: The 2008 extrapolation process used a single stage scaling up from 23% industry coverage by turnover. This method assumed that the 23% was representative of the rest; a potential source of bias. This was mitigated in the 2011 estimates by using multiple datasets. Secondly, the grossing procedure in 2008 was based on turnover. It was a flawed approach, as it assumes a simple relationship between turnover and waste. This is in contrast to the 2011 grossing methodology, which was scaled up through the IDBR, grouped by size (number of employees). As the correlation between site size and waste quantity is likely to be closer than that between turnover and waste, the 2011 estimates are likely to be more robust. Nonetheless, it should be noted that this relationship also carries uncertainty and ultimately, while this method is likely to be an improvement, it remains relatively uncertain.

Scope: The 2011 estimate included a figure for SMEs derived from the 2009 Defra C&I survey, whereas the 2008 estimate did not. This was, however, a relatively minor component of the overall estimate for the food and drink manufacturing sector (approximately 180,000 tonnes), but nonetheless an element that was not previously estimated.

Sources: The 2008 estimate was based only on FDF members, which contained a bias towards larger companies and towards the food sector (with drink manufacturers under-represented). It was also based on data from 2006. In contrast, the 2011 estimate combined data from FDF members, CC2 signatories, Defra C&I survey and the IPPC data. Thus the 2011 estimate is likely to be a more accurate figure.

Coverage: The 2008 estimate was grossed up from data for 235 local sites. These represented 23% of turnover and approximately 28% of local sites (using the IDBR). The 2011 estimate used 448 sites, out of a national total of 845 (53% of local sites).

Conclusion: Although the comparison indicates a fall of 2% between 2008 and 2011

there are significant differences in methodology that suggest that the 2011data are more robust than the 2008 estimate. The combination of different data sources used has provided better overall coverage of manufacturing sites as well as addressing known biases with the previous estimates.

9.2.1 Composition of waste The 2008 estimates were derived solely from FDF membership, whereas the 2011 figures were based on a combination of three datasets. There is higher potential for a bias in the 2008 figure than in that for 2011. However, the 2011 estimate contains a large proportion of IPPC data, originally based on the European Waste Catalogue codes. To bring them in line, these were recoded. There is likely to be a certain amount of error within this process.


Nevertheless, the 2011 estimate both uses different sources and has a higher coverage, thus is likely to be more accurate.

9.2.2 Fate of waste The 2008 estimates were derived solely from FDF membership, whereas the 2011 figures were based on a combination of four datasets. The 2008 figures are therefore more likely to exhibit bias than the 2011 figures. The 2011 figure, however, also has additional influences. Firstly, CC2 is a „willing coalition‟. It can be reasonably argued that the CC2 waste fate data are therefore likely to display a greater-than-average tendency towards fates with an element of recovery or recycling. CC2 waste fate data were a significant proportion of the total. Secondly, there is the issue of categorisation; the IPPC contained different detail on the fate of waste streams to other sources, and had to be reclassified in order to bring it in line. As described above, there is a certain margin of error here. Nevertheless, the lower coverage of the 2008 dataset, combined with the fact that only one source was used, means that the fates estimated for the 2011 data are likely to be more accurate. 9.3 Animal Feed There is little difference between the 2008 and 2011 estimates for animal feed. Nevertheless, they were the result of fundamentally different processes. The key differences are highlighted as follows:

Source: The 2008 estimate was based on data from the FDF, provided by the food manufacturers. It is subject to multiple biases. Firstly, the FDF is committed to reducing waste and diverting more to animal feed. Secondly, relative to the amount of food that is produced, a higher-production site will proportionally send more to animal feed than a site with lower production levels. This is due to the likelihood of them having a regular contract, in turn due to the fact that the logistics for animal feed are more tailored to large quantity delivery. The reliance on FDF membership will therefore tend to over-estimate quantities sent to animal feed due to the greater focus on larger firms. In contrast, the 2011 best estimate was based on the quantities supplied to the animal feed manufacturers (rather than food manufacturers, or intermediaries, both of which would risk double counting). Multiple data sources, including telephone interviews, were utilised to cross-check for accuracy and to protect against double counting.

Extrapolation: The 2008 estimate was scaled up from 23% coverage for all animal feed. In contrast, the 2011 estimate first broke animal feed down into its main constituents (sugar, spent grain and foodstuffs), so that the scaling-up process retained both the detail (i.e. the breakdown of main sources) and the precision of the overall figure.

The estimates use fundamentally different methodologies. Although they have resulted in similar numbers, there is a higher confidence in the 2011 estimates. This could also be interpreted as providing more confidence in the 2008 estimate. However, there is no way of telling what the 2008 estimate would have been with an improved method.


Appendix 1: Surveys

A: FOOD CHARITIES Total tonnage of donations:

England Scotland Wales NI Total (if split is not

available)

Total tonnage of food received, by location

Total tonnage of food received, by country, by organisation type

Grocery

retail Distribution Wholesale Manufacturing TOTAL

England

Scotland

Wales

NI

UK WIDE

Total tonnages of PACKAGING received:

Grocery


England

Scotland

Wales

NI

UK WIDE


B: ANIMAL FEED

England Scotland Wales NI Total (if split is not

available)

Total tonnage of by-product received for use in animal feed

Total tonnage of by-product, by country, by organisation type (should tally with table above)

Grocery


England

Scotland

Wales

NI

UK WIDE

Total tonnages of PACKAGING received:

Grocery


England

Scotland

Wales

NI

UK WIDE


C: WHOLESALERS

England Scotland Wales NI Total

Total food waste arising, by country

Total packaging waste arising, by country

Total (if split is not available)

Total FOOD waste by management, by country England Scotland Wales NI Total

Landfill

Sewer

AD

Rendering

Incineration (with/without energy recovery)

Composting

Land spreading

Charity Donation

Animal feed

Total food PACKAGING waste arising by country England Scotland Wales NI Total

Primary

Secondary

Tertiary

Total

Total food PACKAGING waste by management England Scotland Wales NI Total

Landfill

Recycling

Incineration (with/without energy recovery)

Total


Appendix 2: Waste Classification

European Waste Catalogue codes and their classification as Food, Mixed, Other or Packaging.

M F O P

20 03 01 02 01 01 02 02 99 16 03 04 19 09 02 10 11 12

02 01 02 01 04 10 16 03 06 19 09 05 02 01 04

02 01 03 02 01 10 16 05 09 19 12 02 15 01 01

02 01 06 02 01 99 16 06 04 19 12 03 15 01 02

02 02 01 02 03 05 16 06 05 19 12 09 15 01 03

02 02 02 02 03 99 16 08 03 20 01 11 15 01 04

02 02 03 02 04 02 16 10 02 20 01 28 15 01 05

02 02 04 02 05 99 17 01 01 20 01 30 15 01 06

02 03 01 02 06 03 17 01 07 20 01 32 15 01 07

02 03 04 02 06 99 17 02 01 20 01 34 20 01 01

02 04 01 02 07 01 17 02 02 20 01 36 20 01 02

02 05 01 02 07 99 17 02 03 20 01 99 20 01 08

02 05 02 06 05 03 17 03 02 20 02 01 20 01 38

02 06 01 07 04 12 17 04 01 20 02 02 20 01 39

02 06 02 08 01 12 17 04 02 20 03 03 20 01 40

02 07 04 08 01 18 17 04 05 20 03 04

02 07 05 08 03 13 17 04 06 20 03 06

19 08 09 08 03 18 17 04 07 20 03 07

20 01 25 08 04 10 17 05 04 20 03 99

10 01 01 17 09 04

10 01 02 18 01 01

10 11 16 18 01 04

11 01 12 18 01 09

11 01 14 18 02 01

12 01 17 19 01 12

15 01 09 19 02 03

15 02 03 19 02 06

16 01 03 19 06 04

16 01 17 19 06 06

16 01 18 19 08 01

16 01 19 19 08 05

16 01 22 19 08 12

16 02 14 19 08 14

16 02 16 19 08 99

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Final report Estimates of waste in the food and drink ... · Estimates of waste in the food ... in line with waste regulations. It has not ... and land-spreading are the two main