In a recent interview, Danone (DANOY) CEO Emmanuel Faber shared his view that the current pandemic is increasing polarization in the food sector and the middle class is about to disappear. He sees it this way – as the divide between rich and poor grows, which will be reflected in what they eat, everyone in the middle class will either move up or down to an extreme. Faber zeroes in on the trade down effect that is a key part of our Middle-class Squeeze investing theme here at Tematica Research.
The ‘new normal’ will start to settle in from next year, Faber tells FoodNavigator, and polarisation will only increase. The food giant sees two contrasting trends: an economic and social crisis on one hand, and a growing interest in healthy foods on the other.
“There won’t be a middle class any more in a way, the food medium quotes Faber: “Some of that middle class is going to go down and have to make trade-offs… downtrading…” Conversely, many people “are going to be very demanding on health and quality. The relationship between food and health has never been as clear now for this generation”.