2025 Global Agribusiness Trends

At the start of 2025, it was reported that global food consumption was expected
to expand by 1.2% pa over the coming decade (2024-2033), slower than the preceding
decade due to a slowdown in population growth.

China is expected to recede as the leader in food consumption (consumed 28% of global food over the past 10y), making space for India and SE Asia to take over (expected to make up 31% of global food consumption by 2033).

Food inflation peaked in 2023 but has since returned to a more moderate rate, averaging +2.9% for the Euro area for 2024, back in line with inflation across the economy overall. Food prices however, remain higher than they were before Covid, especially for sugar, olive oil, and certain vegetables.

EU regulation remains problematic, with the Common Agricultural Policy, favouring economies of scale continuing to result in consolidation, leaving larger operations with heavy debt burdens and smaller struggling to remain competitive. The EU environmental legislation focussed on climate neutrality across the region by 2050 is viewed as prohibitive and was a major catalyst for the protests which were a key feature of 2024.

2025, may see change, however. The EU Executive’s recently published blueprint ‘Vision for Agriculture and Food’ (Feb 2025) stated aim is a legislative package to simplify current rules for the agricultural sector, reducing administrative burden for farmers and cutting through some of the problems with environmental legislation. This would enable innovation and increase speed in bringing new products to market – although the timeframes are uncertain as the blueprint will require approval by member states before it comes into practice.

2025 is already proving dynamic, with the impact of geopolitical changes especially around Ukraine and the potential trade war unfolding on tariffs remaining to be seen.
Whilst this creates more uncertainty in the sector, key trends are already emerging.

Technological Advancements

Precision Agriculture:
AI-powered sensors, drones, and robotics will continue to optimise resource use, increase yields, and minimise environmental impact.

Data Analytics:
Big data and machine learning will be vital for predicting market trends, managing supply chains, and improving decision-making across the industry.

Vertical Farming and Urban Agriculture:
Growing food in controlled environments, including skyscrapers and indoor farms, will address food security and sustainability challenges in urban areas.

Sustainability & Climate Change

Sustainable Farming Practices:
Regenerative agriculture, organic farming, and reduced-till farming will be increasingly adopted to protect soil health and biodiversity.

Climate-Smart Agriculture:
Adaptation strategies, such as drought-resistant crops and water-efficient irrigation, will be crucial for mitigating climate change impacts.

Carbon Sequestration and Emission Reduction:
Agribusinesses will play a vital role in carbon sequestration initiatives, aiming to reduce greenhouse gas emissions from agriculture.

Consumer Trends and Demand:

Increased Demand for Organic and Healthy Foods:
Consumers will prioritise organic, sustainably-sourced, and healthy food options, driving demand for certified products.

Transparency and Traceability:
Consumers will demand greater transparency about food production practices, leading to increased traceability and labelling initiatives.

Personalised Nutrition and Dietary Needs:
The continued rise of personalised nutrition will lead to more specialised food products and services.

Shifting Supply Chains and Trade:

Local and Regional Sourcing:
Consumers are increasingly favouring locally produced food, leading to a focus on shorter supply chains and regional markets.

Global Trade Challenges:
Trade wars and geopolitical tensions will continue to impact agricultural commodities markets and global supply chains.

E-commerce and Direct-to-Consumer Sales:
Online platforms and direct-to-consumer models will increasingly connect farmers and consumers, disrupting traditional distribution channels.

A Rise in Generic Products:
Reuters reported in November 2024 that US farmers with slumping incomes and depressed grain pricing were choosing generic products for the Spring planting cycles. The impact was evident on branded business, with Bayer shares falling to a 20 year low in late 2024 and Syngenta, Corteva and BASF expected to face challenges, but this does mark an area of development and opportunity for the generic players in the sector.

Innovation in Food Processing and Packaging:

Plant-Based Proteins and Alternatives:
Innovative plant-based protein products will continue to gain popularity, offering sustainable and healthier alternatives to traditional animal proteins.

Food Preservation and Packaging:
Advanced food preservation techniques and sustainable packaging solutions will extend shelf life and minimise food waste.

Food Safety and Quality Control:
Emerging technologies will enhance food safety and quality control, ensuring product integrity and consumer trust.

Dominic Oldfield, Partner and Global Head of Agribusiness:

‘Agribusiness in 2025 will be characterised by technological advancements, a focus on sustainability, evolving consumer preferences, and dynamic supply chains. Companies that can adapt to these trends, embrace innovation, and prioritise sustainability will be well-positioned.

Key to success will be the ability of leadership to harness change and innovation – particularly around AI, regulation and technology – in order to gain competitive advantage’