The Economics of Food Waste

How much food is wasted around the world, why it happens at different stages, and the economic costs and solutions.

A huge amount of the world’s food is never eaten. Economists and environmental researchers distinguish between food loss, which happens between harvest and retail, and food waste, which happens in shops, restaurants and homes.

The scale

The UN Environment Programme’s Food Waste Index Report 2024 estimated that over 1 billion tonnes of food were wasted in 2022 by households, food service and retail, about a fifth of the food available to consumers. Households were responsible for the largest share. The Food and Agriculture Organization separately estimates that around 13 percent of food is lost between harvest and retail.

Costs

Food waste has several costs:

Money: households and businesses pay for food they throw away.
Resources: water, land, fertiliser, energy and labour used to produce wasted food.
Climate: food loss and waste are estimated to cause a significant share of global greenhouse gas emissions, including methane from food rotting in landfills.
Hunger: waste coexists with hundreds of millions of people facing hunger.

Why it happens

Households: buying too much, poor storage, confusion over date labels, and cooking more than is eaten.
Retail: cosmetic standards that reject misshapen produce, overstocking and short shelf lives.
Restaurants: large portions and unpredictable demand.
Supply chains: in poorer countries, lack of storage and cold chains causes losses before food reaches markets.

Date label confusion

Many foods carry a "best before" date, which relates to quality, and a "use by" date, which relates to safety. Foods are often safe to eat after their best-before date. Research in Europe and the United Kingdom has found that confusion between these labels leads people to throw away safe food. Some UK supermarkets have removed best-before dates from many fruits and vegetables to reduce waste.

Solutions

Clearer date labels.
Apps that sell surplus food from shops and restaurants at a discount.
Food banks and donation laws; France passed a law in 2016 requiring large supermarkets to donate unsold edible food rather than destroy it.
Better storage and cold chains in developing countries.
Planning meals and buying only what is needed at home.

Thinking food waste is only a problem in rich countries

Consumer waste is high in rich countries, but household waste is significant in many middle-income countries too, and poorer countries suffer large losses earlier in the supply chain. Food loss and waste are global problems with different causes in different places.

Key takeaways

UNEP estimated over 1 billion tonnes of food was wasted in 2022, about a fifth of food available to consumers.
Waste costs money, resources and climate, while many people go hungry.
Causes include over-buying, date-label confusion, cosmetic standards and weak storage.
Clearer labels, donation laws, surplus food apps and better storage help reduce waste.